What Buyers Need To Become Owners

Currently there are less than 2000 Active homes in the entire Triangle area listed in the MLS (Multiple Listing Service). For those of you that have the context to know exactly what that means, I will tell you that it means we are at historic all-time low inventory in the area.  We are also seeing sales thriving.  We are on pace to set all kinds of home sales records in 2021. There are currently over 9000 homes Pending sale in the MLS. The demand for inventory creates a VERY competitive market for buyers. If you are a buyer, then there are a few things that you must have in order to successfully get under contract on a home in the Raleigh area right now…..

Flexibility - Buyers have to understand that in this current real estate market environment, they are going to have to exhibit flexibility. Because the inventory is low, sometimes sellers will list their home before they even have a new home secured to move to. They are going to be looking for a longer closing timeframe on what ever contract they accept. This allows them a little additional time to find their next home. They may even be looking for a regular closing timeline and asking to remain in the home after closing for a predetermined period. To be competitive, the buyer may think about allowing them to not only stay in the home but not even charge them for the time in the home after closing.  That is what I am talking about when I say Flexibility. With conditions being what they are, buyers have to bend more than ever to appeal to the desires of the sellers.

NO Contingencies -  If a buyer wants to have any success in offer negotiations or winning a bid amongst multiple offers from other buyers, they have to come into the deal without any contingencies. They absolutely need to be able to buy without selling their current home and if they do have to sell in order to buy then their current home should not only be on the market but also already under contract as well. They also need to consider the type of financing they are getting. If they have an FHA loan or a VA loan, then those loans come with an appraisal contingency to start with and throws up a possible red flag to a seller that someone with a conventional mortgage loan would not have. The smoother the road looks to the seller, the better chance the buyer has in being successful in getting under contract.

Appraisals can also be a point of a contingency. Multiple offers mean contracts well above list price, so it is likely that an appraisal may not meet the contract price. Buyers need to be prepared to make up a potential appraisal shortage that may occur, and if they can’t or won’t, and they don’t communicate that with the seller, then that contingency may just kill their opportunity to own the home they are making an offer for.

$$$ CASH $$$ - Buyers must have cash in this market. Deposit amounts have increased tremendously. A “normal” Due Diligence deposit on a home may have traditionally been $1500 to $2000. That same home in multiple offers will now bring a $5000 to $10,000 deposit. Buyers have to have some expendable cash in order to stay relevant. Buyers also need to be able to make up that potential appraisal shortage as mentioned earlier.  If buyers are qualified with a mortgage to buy a home but they don’t have the extra cash to put toward the home, this may not be the market for them to try and become homeowners.  

There are so many variables to consider when making an offer on a home even in a “normal” market. With the conditions that we are currently experiencing in the Raleigh/Triangle area, there are even more “balls in the air” that need to be juggled. If you are considering buying a home, please do yourself a favor and hire a professional. Get yourself an Exclusive Buyer’s Agent to help you. Our team at the Kima Real Estate Group is here to help you. We have several Exclusive Buyer Agents on the team that are getting homes under contract. Give us a call today and let us show you how we can make you a homeowner also. 

Chad Wingler

Lead Buyer Specialist

919-300-5421