Top 10 Ideas To Buy The Right Home in a Fast Moving Market

Bozeman's HOT Market and how to cope

Blog written by Coldwell Banker Distinctive Properties agent, Mark Corner.  Mark has been in real estate for 40 years and grew up ski racing at Bridger Bowl since 1972! 

1.  Get your finances in order first.

Before you start looking at houses, meet with a lender and review your credit report, finances and get a preapproval letter for when you need to make an offer.  Every buyer out there is looking for that "best value" home.  You need to be prepared to move faster than other buyers.

2. Set up listing alerts with a Realtor® through your local Multiple Listing Service.

Many of the popular national real estate web sites do not update their listing information often enough from our local MLS.  Some are 2 days behind.  If you don't know about a new listing as soon it comes on the market, other buyers will be writing their offer before you even know about the house.  With a listing alert with a Realtor® in our local MLS, you will be notified instantly when a new property matches your search criteria.

3. Make your highest and best offer first.

In a slower market, you could commonly start with a 90% of list price offer and feel out the seller's motivations.  Then over the next 3 or 4 days you could play the high-low game with the seller until you agreed on a price.  In our fast moving market, if you take 3 or 4 days to play the high-low game, 2 or 3 other offers will now be competing against you and you will pay much more than if you offered your highest and best price first when there were no other offers. 

4. Make a larger earnest money deposit.

A larger earnest money deposit shows the seller you are more serious about not backing out of the sale where you might forfeit your earnest money deposit.  With a minimum amount of  earnest money, the seller feels it is easier for you to walk away.

5. Keep your contingencies to a minimum.

In a fast moving market, it is very common for sellers to receive multiple offers.  Contingencies like selling your existing home first or asking to occupy/rent prior to closing will make your offer less attractive. 

6. Keep your performance dates as short as possible.

A shorter closing date can make your offer look better to the seller.  Consult with your lender and Realtor® to determine how quick you can close based on the type of financing you have selected.  The biggest road block is usually the time it takes to receive your appraisal.  Currently, Bozeman appraisals are 3 to 4 weeks out.  If you can make an all cash offer, you can close in 7 to 10 days where an appraisal is not required.  As well as shorter dates for your contingencies like home inspection, preliminary title report and home owners insurance rates.

7.  Write a personal letter to the seller with your offer.

Many times the seller has raised their family in their home and would love to see another family lover their home as much as they did.  It doesn't work every time but it can make the difference of your offer getting accepted over another offer the seller knows nothing about.

8. Consider making a back up offer on a home that is already under contract.

Even though a home may be under contract, sellers usually accept back up offers.  It doesn't cost you any money to be in a back up position and you can cancel a back up offer any time before being accepted.  Should the primary offer fail, if you are in the #1 back up position your offer now becomes the primary offer.  Your earnest money will then be due according to the terms in your buy sell agreement.

9. Be in a position to sign documents as soon as possible.

In a fast moving market, time is of the essence.  Be available to sign offers and counter offers either in person or by electronic signature through email as soon as possible.  Don't try and read and sign documents through your phone.  So many people today are ditching the home computer and doing everything on their phone.  It also helps to have access to a printer so you can print out and read the fine print in documents full size.

10. Don't overlook For Sale By Owner and Craigslist homes.

More sellers today are trying to sell their home on their own and using the For Sale By Owner program or listing their home on Craigslist.  Most For Sale By Owners are still willing to work with a buyer's agent and offer a commission to the buying side.  You will be in a much stronger negotiating position using a Realtor® as your buyer's agent even though a home may be listed as For Sale By Owner.