You’re ready to make an offer! You’ve done your homework by reviewing a CMA (Comparative Market Analysis), local DOM (Days On Market), and even the LP:SP (List Price to Sales Price) ratio to formulate your offer based on the numbers, and you have confidence in the mathematics.
However, there may be “non-tangible” factors that don’t fit neatly into the equation. Your representative will endeavor to discover variables like the seller’s motivation and your possible competition. If the home you want has been listed much longer than the average DOM, the sellers may have become more realistic and more motivated to accept lower offers. Sometimes the sellers are motivated by the pressure of having purchased, or offered to purchase, another home. Then time becomes more important than money. No one wants to pay two mortgages or risk their ability to close on another purchase because they can’t sell their first home.
Also try to find out if other buyers are making offers on your chosen property. If so, make your first offer your best offer, because sellers are unlikely to counter in this situation. But – never offer more than your representative believes the home will appraise for, or your financing will fail and you’ll be back at Square One. Talk to your agent about the facts and the variables, and then make your offer with confidence.
Elwynn Schwartz is the owner of Chattanooga Real Estate Consultants and may be reached at 423-894-3050.