In previous blog posts we have looked at preparing for your home search and getting your finances in order, deciding what type and location of home would best suit your needs and wants and how to look at homes in relation to your lifestyle, needs and wants. We have prepared for your housing search, we have identified our potential homes, we have looked at them with a critical eye and we have the found the house that you would like to make your home. What next? Today we will be looking at the process of making an offer to purchase the home that you desire.
There are three main considerations that we would discuss as part of our offer preparation. They are;
- Is there interest from other buyers, are we competing for this property?
- What have comparable homes sold for? The list price may not be an accurate indicator of value.
- What are the current market conditions? Do they favour the buyer or the seller?
How we approach and present our offer will vary depending upon the answers to these questions.
When we sit down to prepare an offer it is important that we understand and clearly state what your intentions and expectations are. A successful offer negotiation will result in a legal contract with certain rights and obligations for all parties. As your realtor I will discuss all aspects of the offer with you to make sure that it adequately expresses your wishes while offering you the protections needed to prevent you from making a poor decision. The points that we will discuss are;
- What condition shall we include in the offer, do you have a house to sell, are there environmental, zoning or other issues that need to be checked? With the correct conditions we can clearly outline buyers and sellers responsibilities and what will happen if either side fails to satisfy their obligations.
- What price would you like to offer and what will your deposit be? As your realtor I will also counsel you on what the chances of success and likely responses are to any particular offer price.
- What financial terms are included in the offer and what obligations and costs to they confer upon you and your bank balance?
- What is your preferred closing date and how does that match up with the sellers preference? What benefits or disadvantages are there to being flexible with your closing date?
- Should you have a home inspection? Assuming that you do have the home inspected what potential costs for you are involved in owning this home and are they appropriate considering the price paid for the property and your financial plans for the coming years? Should you buy this house?
- What fixtures and chattels are included in the sale price and which are excluded? Remember, if it is not written in the offer it is not valid!
There is a great deal of information to be learned when purchasing a home and it is a good idea to prepare as much as you can. I would recommend that you read over a sample offer. Highlight any points that require clarification and ask your realtor any questions that you may have. We are here to help guide you through the process and to make sure that you are confident and comfortable (hopefully excited as well!) throughout the entire process.
In closing here are the top 5 points to consider when making an offer;
- What are the comparable sales to the home I am considering and what value do they indicate?
- Clarify the key elements of the offer, are you happy with the price offered, deposit, terms and inclusions and exclusions?
- What conditions provide you with the protections that you require and what are your obligations?
- Read a draft of the offer and be familiar with it’s meanings and terms.
- Make sure that the offer communicates your intention clearly.
I hope that you have found this helpful. Please get in touch with any comments or questions by email at email@example.com or call my direct line at 519-590-6118.
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