A persistently low supply of homes for sale has been holding back sales numbers and exerting upward pressure on prices for some time now. This is a nationwide problem that echoes strongly in the Bend Oregon real estate market.
Earlier this month, the number of active residential listings in the Bend area was equivalent to 2.7 months at the current rate of sales. A year ago it was 3.2 months. Nationally, the unsold inventory of existing homes represents a 4.7-month supply.
With home buyers outnumbering sellers, bidding wars are inevitable. Agents of Harcourts The Garner Group Real Estate in Bend report they are encountering multiple offers on a regular basis, particularly on the most desirable properties.
How can real estate buyers come out ahead in a bidding war? Here are some tips from The New York Times via Realtor® Magazine:
Get preapproved for a mortgage. A preapproval letter from a lender can show that a buyer is a strong candidate to obtain financing.
Have a strong start. What can you most afford? Offer accordingly. That said, “don’t go to a point where you think it’s going to be too much to handle,” advises a New York agent. Also, if home buyers offer more than the asking price, they should be aware that their mortgage lender may still appraise the home at a lower value. This could leave them having to pay the difference.
Waive the mortgage contingency, but … Sellers tend to prefer offers that are not contingent on the buyers’ ability to obtain financing. So in hot markets, an offer contingent on the mortgage could be viewed as a detriment. Yet, without this contingency, home buyers can run a risk of losing their deposit if their financing ends up falling through. They’ll want to weigh this one carefully and consult a lawyer.
Don’t just bank on the letter. A heartfelt letter attached to your offer has gotten some buzz lately as a winning strategy. While a nice touch, “don’t expect them to distract the seller from the bottom line.”
Cash. And one of the best ways to win a bidding war: Offer cash. Sellers like all-cash offers because it provides more certainty the deal will go through and without delay. If an all-cash offer isn’t practical, have your buyer find other ways to provide the seller certainty that the settlement will go through.