Just ask anyone that is in the market for a new home and they’ll tell you how challenging the current market conditions are. There are more buyers than there are houses for sale. As a result, many homes are selling within days of being listed and multiple offers and bidding wars are the norm.

So how do you increase the chance that your offer will be accepted?

Here are 5 tips for making a competitive offer that will help you stand above the competition.

1) Understand Your Finances

Many times, homebuyers have a preconceived notion of how much home they can afford based on a preconceived notion. They often have a number in mind that “seems right” or “feels good” and isn’t really based on anything factual. Even if you’ve used an online estimated mortgage calculator that isn’t telling you the whole story. The best way to determine what payment and purchase price fits your budget is to get pre-approved with a lender early in the home buying process. Only 44% of today’s homebuyers get pre-approved before they start shopping for a home. Knowing how much you can comfortably afford before you start to shop gives you peace of mind and lets you know what you can. and can’t do, should you end up in a bidding war on the perfect house. In addition, most sellers in the current market won’t even consider an offer that isn’t accompanied by a pre-approval letter.

2) Be Ready to Move Quickly

I’m certainly not suggesting you rush into a purchase or buy before you’re ready, but when the right house does come on the market you need to be in a position to act. According to the Realtors Confidence Index, published monthly by the National Association of Realtors, the average home being sold today is receiving three or more offers and is on the market for only a few weeks. Here in Frisco and Prosper, we are seeing many homes sell within a matter of days, not weeks.

3) Make a Fair Offer

Every home buyer wants the best deal they can possibly get, but in the current market sellers have the upper hand. I’m not suggesting that you overpay, or make a full price offer on an over-priced home, but believing you are in a position to pay less than fair market value could be the difference between getting the house and not.

I was working with a couple that had a very particular home in mind in a specific neighborhood but were also determined to get a deal. The exact house they wanted came on the market and despite my advice to make a full-price offer (the home was flawless) they chose to offer less. While the back and forth negotiations were taking place another offer came in and my buyers ended up missing out. They were devastated and it hurt even more when they learned they missed out on their dream home by $1000.

4) Be a Flexible Negotiator

After you submit an offer, the seller will either accept it, reject it, or make a counteroffer. In a competitive market, it’s important to stay flexible and nimble. Your position can be strengthened by being flexible on contract length, move-in dates, a higher price, or minimal repair requests. However, I would suggest you don’t forgo, or waive, inspection periods/contingencies. Freddie Mac explains:

“Resist the temptation to waive the inspection contingency, especially in a hot market or if the home is being sold ‘as-is’, which means the seller won’t pay for repairs. Without an inspection contingency, you could be stuck with a contract on a house you can’t afford to fix”

5) Listen to Your Real Estate Agent

Unless you are a seasoned investor, all homes are bought and sold with emotion. It’s perfectly natural to fall in love with a house, but that emotion can sometimes cost you thousands of dollars or lead to decisions you regret later. A trusted professional should act as a guide to help you stay focused on the most important things. In Freddie Mac’s guide on making an offer in today’s market they state:

“Remember to let your homebuying team guide you on your journey, not your emotions. Their support and expertise will keep you from compromising on your must-haves and suture financial stability.”

Your real estate professional should be your primary source for answers to the questions you have when ready to make an offer.

Do you have additional questions about today’s market? Schedule a free. no-obligation consultation with Andrew to get your questions answered by clicking the following link Talk with Andrew.