For those of you that haven’t noticed, snatching up a home in or near Chicago’s city center has been tough the past two years. Very few homes have been available to begin with, and the high demand for them has led to a lot of buyer competition. Buyers have to beat out multiple other offers to get the home they want, and are having to spend quite a bit more if they want to win the bidding war. And we don’t expect this trend to slow down just yet, since many prospective buyers will want to lock in a low interest rate before they start rising this year.
So what can you do to have an edge in a competitive seller’s market? Here are our top 6 tips for being a successful and savvy home buyer in today’s sizzling Chicago market.
1. Move Fast
To win in today’s market, you’ve gotta move quickly. Save a search with your neighborhood and price criteria in the MLS or your favorite real estate website, and set up email/text alerts for new listings that pop up in the market. If you see something new, get in there to see it as soon as physically possible. Then, be prepared to make an offer right away if you like what you see. That extra day to think things over could be the difference between you and your dream home.
2. Get Pre-Approved
Get pre-approved for a mortgage before you start searching. This shows sellers that you are serious about buying a home and will enable you to close quicker than buyers who have not already gone through this process. Plus, it will help steer your search so that you don’t waste your time looking at places you can’t afford.
3. Loosen or Remove Offer Contingencies
Make your offer more appealing to a seller by having fewer conditions that need to be met before closing. For example, you could pay in cash to remove a mortgage contingency, or offer a shorter mortgage contingency period. You could also offer a short home inspection contingency with a promise to take the property as-is. This means that you can’t ask for repairs to be made based on what is found during the inspection, but you still have the opportunity to walk away from the deal if you want to. It can even be as simple as promising more earnest money up front to show that you mean business.
4. Butter Up the Seller
Ask your realtor to call the seller’s agent to learn more about their client. Finding connections between you and the seller to build trust. Then, learn where they are moving to and when they are hoping to close. This will enable you to craft an offer that will appeal to the seller. And while you’re at it, it can’t hurt to have your agent compliment the seller on your behalf. Ask your agent to express how much you love their kitchen remodel or the way they laid out their living room furniture.
5. Seek Out Homes with Less Buyer Traffic
Consider a fixer-upper that has a lot of potential but not a lot of interest. Many buyers are intimidated by the time and commitment involved in massive renovations, and may have a hard time seeing past the current appearance in online pictures.
6. Separate Your Needs From What Your Wants
When inventory is limited and prices are high, you may need to make sacrifices. It’s helpful to already know what you absolutely must have in a home, versus features that would be ideal to have but are not deal breakers. This is a big purchase, and the last thing you want to do is settle for a home that doesn’t meet your needs! If you’re finding that your needs and your price range don’t match up, consider expanding your search into adjacent neighborhoods that command a lower price point.
Now more than ever, buying a home in Chicago is a team effort. More eyes on the MLS and more brains strategizing a counter offer negotiation means a greater chance of becoming the owner of your dream home. To be successful in today’s seller’s market, you will absolutely want a dedicated realtor with expertise in Chicago’s market on your side.
Center Coast’s agents have been around Chicago’s blocks more than a few times, and put simply, they get it. Let us know if you need a resourceful and driven Chicago real estate agent to represent you.