We’ve talked before about how the San Francisco real estate market moves lightning-quick. It’s an extremely competitive market, and it shows no sign of slowing down. Houses put on the market are snatched up sometimes even the same day. With so much traffic, many San Francisco home buyers are worried that their offer will get lost in a crowd. With more buyers than houses, buyers feel a very strong fear of losing out.
How to Win in a Competitive Real Estate Market
To avoid that — and to make sure that when you find your dream home, your offer gets noticed — there are a few extra things you can do to boost your chances. Here are our five favourite tips for winning in a competitive market, and making sure that your offer is the one to succeed.
#1. Don’t Low-Ball
This tip is pretty straight-forward, but all too often we see people failing to heed it. San Francisco is very much a seller’s market, and the offer that gets chosen is definitely going to be a competitive one. Low-balling the asking price, or even low-balling the expected selling price by failing to factor a sufficient increase for the other likely bids, is a sure-fire way to get your offer lost in the discard pile.
#2. Get Pre-Approved for Financing
Any seller wants a guaranteed sale upon accepting an offer. Taking a chance on something uncertain can leave them high-and-dry, and passing on other bids that might have come through. Don’t let your offer be a dice roll. If you get pre-approved for financing, you add a layer of certainty to your offer that many others might lack. That makes yours particularly attractive to any seller, but that’s even more true in the San Francisco real estate market.
#3. Offer a Quick Close of Escrow, or an On-TIme Close Guarantee
As we’ve mentioned, sellers are often eager to close a sale as quickly as possible. If your offer helps them make that happen, it instantly jumps to their shortlist. For a faster close of escrow, be sure to respond promptly to your loan officer, and keep all required documentation somewhere handy. This includes pay stubs and other statements of account, as well as a variety of other paperwork. Even if you submitted it as part of your loan approval pre-process, it’s still important to have those handy. In some cases, your loan can begin the process of being underwritten prior to closing a contract, potentially shaving weeks off your sale timeline.
Offering an on-time close guarantee is another great way to incentivise your offer. You might do this by making your earnest money non-refundable, which does come with a certain risk. It might be a tricky step in some cases, so be sure to work with your San Francisco Realtor to find the best path for your specific circumstances.
#4. Keep it Simple
The more complicated your offer is, often the more likely that a simpler, more straightforward offer will beat yours out. To that end, you’d be well advised to eliminate as many of the complexities as possible. If you’re in a position to offer cash, even better. That helps ensure that the sale will close quickly and smoothly, with minimal fuss. Since most buyers aren’t in a position to fill the entire sale in cash, an exceptionally large down payment (say, 30-40%) can be another way of keeping things simple, as well as confirming that you’ll have no trouble getting a mortgage.
As well, in your offer, it’s often a good idea to omit many of the more minor sub-clauses. The sales contract is already likely to include plenty of detail about what will happen to any rental items, appliances, drapery tracks, and so on included in the purchase, and making them part of your offer is often redundant. Cutting them out can take pages off your offer, and any seller will appreciate anything you can do to keep the sales process as simple as possible.
#5. Hire an Expert San Francisco Realtor
This is the absolute most important step to making sure your offer gets noticed. A San Francisco real estate expert will be able to guide you through all the ins and outs of the sale to be sure that your offer comes out ahead of the pack.
Before you make an offer on your next San Francisco home, contact Danielle Lazier + Associates and let one of our elite San Francisco Realtors optimize your bid to help win you the home you’ve been waiting for.