Low Inventory: Buyer Considerations

As promised, we want to address your questions around the issue of low inventory; and we need to look at both seller and buyer considerations. As a seller, you have the opportunity to be in the driver's seat when low inventory markets arise. Most of our sellers, however, will also be buyers in the same "low inventory market." Let's talk about some things you might want to start thinking about, as you plan for your move.

1. First... Do you understand "List Price?" Many markets offer the opportunity to bargain with sellers or request closing costs to help with the final figures at closing; however, in most cases, a low inventory market does not afford us this opportunity. The list price is always a data-based suggestion and is not often the final sale price. Low inventory markets place high demand on well-priced and well-marketed properties and, as a buyer, you must be able to wrap your mind around "the art" of offering. As we face many multiple offer situations in a market like this one, we must be ready to offer over the list price in order to win the home.
2. Next... Do you have some extra cash? Many buyers have employed the tactic of offering an appraisal gap clause to their purchase agreement, especially when in multiple offer situations. This means that the buyer is offering a price that may be found to be over the appraised value and they win the home by ensuring that they will bring extra cash to the table to cover the spread between the offer price and the appraised value. There are many considerations in this tactic, so we can discuss them as you progress in your process!
3. Finally... How flexible are you? Remember, sellers may be getting 3-20 offers from eager buyers who need to find a home. Consider whether you can be flexible on closing date, inspection (yes/no?), earnest money amount, rent back agreements, and many other variables that a purchase may entail? What are you comfortable with and how creative can we be, as we endeavor to win?

​These are just a few of the biggies, as we explore buyer considerations in a low inventory market. Do you have questions as you prepare to jump into this market? Call me, and let's chat about your unique situation and how we can position you to win the home you love!

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