5 Tips For Winning a Home Sale Bidding War in 2017

Competition for the opportunity to buy a home in West Michigan has escalated dramatically within the past 24 months.  Bidding wars are now the new normal.  Potential home buyers may find themselves engaging what may feel like a Reality Show competition when they enter into the ring to bid on a fresh or particularly enticing entry into the housing market place.46500589 - model of cardboard house with key and dollar bills. house building, loan, real estate, cost of housing or buying a new home concept.

In the current real estate arena, knowledge, street smarts and a good team makes a big difference!  Here are some tips to up your ‘winning game’.  Study these details gleaned from over two decades of front line service by an experienced real estate broker to give yourself the edge as you mount your strategy in obtaining the home of your dreams!

1. Be Market Ready. Get Your Financing up to Snuff!

The current (January – February 2017) housing inventory in West Michigan according to the Grand Rapids Association of REALTORS is 1.4 months of supply.  To put that in days – roughly 42 days of housing stock and the market depletes.  IF your’re a seller on the other hand, this means it will take roughly 75 days to list, market, and close your home sale provided you’re within the general norms of the area with regards to price and presentation.

Given these stats, REALTORS have taken to pleading for listings on social media as there are too many buyers looking for a limited supply of homes.  If you’re serious about getting a home, get Pre-approved now.  Submit to the often grueling process of having all your financial details examined by an experienced loan officer which include verification of your credit, employment history, assets and liabilities.  Get your money together too!  The more cash you have (which must be verifiable aka being in the bank long enough to verify that you obtained it legally) the better prepared you will be to win in the days ahead.

 2. Choose  Your REALTOR carefully.

Experience matters when choosing a professional REALTOR to represent you.  But so does temperament and the ability to persevere.  There is so much strangeness in today’s marketplace.  People are bidding for homes as though they are on the gaming floor in Vegas!  And when the high disperses, many are re-thinking what they just paid for a home!  It can become a vicious cycle, which is best avoided rather than trying to detangle.  A good REALTOR by your side will advise and fight for you. In fact, the reputation of a good REALTOR can be powerful edge when a Seller is trying to determine which offer is ‘real’ and which one may be likely to fake out after a month or less leaving them devoid of a truly viable offer to purchase their home.

3.  Circle the Market like a Hawk!

At Audu Real Estate, we provide Homebuyers with a private shopping portal that shoots out instant notifications when new listings pop up on the market.  This gives you an edge over your competition.  But understand that seeing the home before the herd stomps through is itself NOT enough to guarantee you will get the home just because you’re the first offer.  Read on to the next tip to understand WHY strategy is important.

4.   Strategize Like a Pro!

Negotiations are a critical component of the drive towards winning in the real estate multiple bidding arena. There are many components to a successful negotiation and this blog would be way to long to list all of them here.  But, for starters here are some important components for consideration in a winning negotiation:

*Price

*Financing

*Marketplace Knowledge & Comparison

*Terms & Conditions

*Timing

*Flexibility

*Method & Manner of Presentation

*Closing Date

No one wants to win a negotiation only to discover later that you purchased a lousy deal!  Believe me, many who suffered through the recent past recession within which many lost homes through foreclosure will tell you – Buyer Beware.  All that glitters is NOT gold. Which leads us right into our final tip…

5.  Be Sane!  Stay Flexible

Emerging from this process with your new home and sanity in place is the real win!  Buying a new home requires a certain solid internal confidence that in the end, you will prevail.  A belief that if a home is for YOU, it will be yours no matter what storms and obstacles present themselves.  Resolve internally that YOU WILL OVERCOME!  It will not necessarily be easy, but remember that this too shall pass.  Even if the process takes six months, at some point it will be over.  And you will have the enjoyment of your new home for hopefully many years.

Keeping this in mind, it is good to be mindful of the health and sanity of the real estate professionals who you will need to assist you along this journey.  Be kind.  Appreciate their efforts.  You are likely NOT their only client.  So when you are able to reach your ‘help’ after normal business hours and they spend an hour with you on the phone, say THANK YOU.  A good REALTOR or Lender will be going more than the extra mile to help you.

Often, the activity behind the scenes will pale in comparison to the effort you are privy to.  In fact, after you decide on a home, the REALTOR’s job has just begun.  And in a multiple bidding war is likely to include late nights, frustration, dealing with all sorts of issues – some of which are real and some of which are as fake as the ‘fake news’ cycle.  Think about this – treating them with dignity and respect increases the chances that they will be willing and available when you or your friends and family need help the next time housing becomes a priority in your life!

photo credit 123.rf

Home Inspections. Do I really need to spend money on this?

Question:  Do I really need to spend money on a home inspection?

Answer:  In short the answer is Yes.  Even for a home that looks perfect and is beautifully presented.  And, Yes – even for a home that is brand spanking new.

Why?  Well, because a house should be through of as a unique set of systems and parts.  It’s more than the ‘personality’ you fell in love with.  It’s more like a spouse, you’re committing to live with. As with matters of the heart, the first blush will fade over time.  When the inevitable reveal occurs (worts and all), housing matters can be extremely expensive to correct.

Home Inspectors are trained to inspect major systems such as heating and air conditioning as well as the condition of the structure, roof, plumbing and electrical system.  If you have a chimney, they will peer into it and inspect it or advise you to contract with a specialist.  They’re also trained to look for evidence of infestation of all sorts of creepy crawlers, ants and mice.  Some types of mortgages will require a pest inspection for termites, which by the way are surprisingly common in West Michigan.

Then there’s the gas thing – Radon testing has become increasingly common in West Michigan.  Radon is an odorless gas that can kill – yes, Kill YOU if it is undetected.  So can carbon monoxide coming from an improperly functioning furnace.

Mold is another issue which can be dangerous if it is of a certain variety, and it’s always important to determine the source of the water penetration and correct that!

I could go on and on, but I think you get the point.  I highly recommend investing in the services of a qualified home inspector.  Preferably someone who is impartial and not related to you – parents and friends may mean well, but they rarely have the experience necessary to provide an unbiased opinion on an investment which is likely to be the biggest one you’ll make at any one time in this lifetime.

More FAQ’s (Frequently Asked Questions) here

About the FAQ (Frequently Asked Questions Series)

This series is designed to answer questions that we hear clients asking over and over again.  Perhaps, you’ve wondered about some of these questions yourself.  While this is not intended to be an exhaustive explanation on the subject being discussed, it is our hope that these short blogs will provide helpful insights and may encourage you to explore further.  Please feel free to contact us by phone or e-mail with any questions.

FAQ Series: What’s the Difference between a Pre-qualification and a Pre-approval for a Mortage?

Question: What’s the Difference between a Pre-qualification and a Pre-approval for a Mortgage?

Answer:  Unfortunately, there is no absolute definition for the terms of Pre-qualification or Pre-approval.  The definition depends on the Lender who is issuing the terms/letter under which they are willing to loan money.  When purchasing a home or evaluating a potential buyer for the sale of your home as an owner, a better question to ask is: “What does the Pre-approval or Pre-qualification actually allow me to do“?

Ideally, a full Pre-approval means that the Lender has verified the accuracy of the documentation a potential borrower supplied pertaining to  finances, employment and rental and home ownership history.  It would also indicate that credit has been fully vetted with a mortgage report combining the results from three agencies and the borrower’s debt to asset ratios are appropriate to support the loan that is being requested.  The pre-approval would then amount to a check held in earnest pending finding a home which also meets the requirements necessary for the Lender to finance the purchase.

Unfortunately, there are significant variations in the use of both terms.  Generally a Pre-qualification carries the least amount of weight because it is filled with caveats and is often not fully verified and/or documented in the way most standard Pre-approval letters are.  While a Pre-qualification can serve as a good starting point when you are thinking about making a home purchase, you may find that the terms and conditions for an actual loan are different from your initial Pre-qualification.  Since the Lender has not necessarily verified the information you supplied during a Pre-qualification, there is no promise that a borrower will be in a position to qualify for a loan.

For an owner considering a purchase transaction, it may be prudent to request that a potential buyer submit to a Pre-approval process prior to taking your home off the market.  It would also be wise to check with the Lender to verify the steps that have been taken to ensure that the prospective buyer is financially qualified to purchase your home.

More FAQ’s (Frequently Asked Questions) here

About the FAQ (Frequently Asked Questions Series)

This series is designed to answer questions that we hear clients asking over and over again.  Perhaps, you’ve wondered about some of these questions yourself.  While this is not intended to be an exhaustive explanation on the subject being discussed, it is our hope that these short blogs will provide helpful insights and may encourage you to explore further.  Please feel free to contact us by phone or e-mail with any questions.

FAQ Series: Is it really necessary to hire an Inspector to inspect the home I want to buy?

Question:  Is it really necessary to Hire an Inspector to inspect the home I want to buy?

Answer:  Short answer is YES!  Long answer is as follows:

Purchasing a home is the largest financial investment that most Americans will every make.  That fact alone should give us pause about moving forward without due diligence.  Most of us don’t buy a car without ‘looking under the hood.’  Why would we consider buying an investment which costs many multiples of the price we’d pay for a car without having an additional pair of professional eyes reviewing the deal.

Home inspectors are trained to look for details about a home which you may be ignorant about or may have missed in your excitement about the prospect of owing your new home.  They can be an objective source of information about potential repairs or hazards.  In addition, a good home inspection will provide a lot of information about how to care for your home when you are the new owner.   A home inspection will give you vital details about the major structural components of your home as well as inspect the appliances, electrical service, plumbing, heating and history of infestation.  Other inspections may include testing for radon, mold and well/septic tests.

When you inspect a home, BEFORE you purchase it, you’re more likely to be able to negotiate for repairs with the owner.  That’s real money which doesn’t leave your pocket.  What’s not to love?

More FAQ’s (Frequently Asked Questions) here

About the FAQ (Frequently Asked Questions Series)

This series is designed to answer questions that we hear clients asking over and over again.  Perhaps, you’ve wondered about some of these questions yourself.  While this is not intended to be an exhaustive explanation on the subject being discussed, it is our hope that these short blogs will provide helpful insights and may encourage you to explore further.  Please feel free to contact us by phone or e-mail with any questions.

The Heat Map…Re-defining the Meaning of Hot Grand Rapids Properties!

Bull's eyeHot Off the Press!  The Grand Rapids Association of Realtors has just rolled out a brand NEW re-design of it’s Multiple Listing Service website.  Training to understand how to fully utilize the site has been on-going and sometimes gruelling for real estate agents and brokers since December of 2007.

The New Multiple Listing Service (MLS)  will allow real estate agents to do an extraordinary amount of in-depth analysis of neighborhood values and communities.  Agents will eventually be able to create personal websites and URL’s for individual customers to have access to highly personalized information.

Enhanced mapping functions and research tools will enable knowledgeable  real estate agents to give clients a proverbial “peek into the future” by manipulating various scenarios to predict a probable response to a particular listing. 

For instance wouldn’t it be nice to KNOW if a 5% reduction in your price would increase your pool of potential buyers and thus chance of a successful sale by 25%?  In a competitive environment in which sellers need to sell their property, this allows us to help you pinpoint the best strategy to get your home Sold!

One of the features which will be truly helpful to home owners is the ability to obtain a Customized Block Rendering of the Home Values across different spectres of a neighborhood.  This Heat Map will allow home owners to see at a quick glance what prices  parts of a community or neighborhood are selling forThis can also be extremely helpful when considering a home purchase.

If you’d like to learn more about how these new tools, Including the Heat Map, can help you make a wise decision regarding Selling or Buying a home in Grand Rapids, Michigan, please e-mail us at info@auduhomes.com.  

In addition, we’ll be happy to e-mail you a  preview a sample of our comprehensive marketing plan along with other information regarding our specialized Internet Marketing Services.  Our on-line services will enable your home listing to have enhanced visibility on the Internet where it has been documented over 80% of Home Buyers look first!

Related Blog post: If You Could Peer Into the Future…Would You Sell Your Home?

Protecting Your Home Improvement Dollars When Buying or Selling Your Grand Rapids, MI Home!

Home Improvement - caulking tileNo one wants to waste money these days!  In Grand Rapids, MI where thousands of homes are vying for the attention of a limited pool of buyers, it’s even more important to make your home stand out when buyers do come knocking…knowing they’ll be knocking on an average of 20-25 homes before they make a decision.

I’m often asked about Home Improvements which home sellers would like to make to improve their chances of selling.  I’ve written about advice which I give regarding home staging.  But, what about major home improvements?  What’s the return on your investment if for instance you want to add granite counter tops to your kitchen or are contemplating new siding?

These questions are also relevant to home buyers when shopping for a home which if purchased correctly and improved intelligently could Net a Nice Profit when the home is sold.  A Home Improvement Report from Remodelling Online is  a Fantastic Resource for home improvements and the Return on Investment in the Grand Rapids Area.  The report compares the average cost of the investment, resale value and percentage recouped on average from a sale. 

According to the report, the Top 6 Values for Return on Investment in a Home Improvement Project in the Grand Rapids, Michigan area are:

Deck:  Cost Recouped  ~ 85%

Windows:  Cost Recouped ~ 81%

Kitchen:  Cost Recouped ~ 78%

Bathroom:  Cost Recouped ~ 78%

Attic Bedroom:  Cost Recouped ~ 76.6 %

Basement:  Cost Recouped ~ 75%

If You are interested in a FREE Staging Analysis to see how to Prepare Your Home for Sale…Contact Us!

Click Here For Related Article on Interesting Garage Improvements.

*Special Thanks to Gary White, real estate agent in Commerce, Michigan for assistance with research for this post.

Grand Rapids, Michigan Smart Home Buying Guide…

It's a Great Time to Buy in Grand Rapids, MichiganWith 5 consecutive days of interest rate cuts, there’s more than a few things to put a smile on your face if you’re in the market to buy a home in Grand Rapids, Michigan.  For starters, according to the Mortgage Bankers Association in an article carried by Inman News, the good news has fueled a 32 % Increase in mortgage applications; the highest in 4 years.   

This is a great time to buy a Grand Rapids, Mi home.  I’m looking outside my window at what looks like fall.  The snow has all melted thanks to 60 degree weather.  Although, it’s a little misty and rainy, at least you’ll be able to truly see the yard and layout of the land.  Warm weather combined with great rates and tons of inventory…what’s not to love!

Here’s  a list of some articles which will be helpful for Smart Home Buying in Grand Rapids, Mi.  Always feel free to contact us if you have any questions or would like to look at homes you find on our website.

To Read Other Articles in the Smart Buyers Series Click below…

home buyers: Michigan Buyers…When the Government Gives Free Money to Buy a House…Go Get IT!

home buyers: How To Avoid Paying Too Much for Your Next Home!

home buyers: How to Avoid Buying a Real Estate Lemon.

home buyers: Limitations Are Simply A Matter of How You See Things!

foreclosures: So, You Want A Great Deal on A Foreclosure…10 Power Tips for Success!