QUESTION: We’re trying to buy a house and having no luck. Many homes are gone before we can submit a contract. And when we do manage to, some investor outbids us with a cash offer. How do we deal with this?
ANSWER: Demand is extremely high now as international and amateur investors try to get into the market due to perceived value and the low return on investments outside of real estate. In certain areas, foreclosures are selling at auction for more than market value, and investors are making offers on properties by the dozen, sight unseen.
So even with today’s low interest rates, now may not be the best time for some owner-occupants to buy a home. Don’t let the sense of urgency persuade you into buying a home you don’t love. That’s never a good move.
Remember that these feeding frenzies are always temporary. Lenders and investors that bought six months ago are starting to put more properties on the market to take advantage of rising prices.
If you can’t wait and must buy now, here are a few tips to consider: Type, rather than hand-write, your contract offer, making sure that it’s filled out completely and correctly. Make your first offer your best offer, including the largest down payment you can comfortably afford and as few contract contingencies as possible. Speak directly to the seller or write a letter explaining why you want the home. That may be what it takes to sway someone to sell to a live-in buyer rather than to an investor.
Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. Send him questions online at http://sunsent.nl/mR20t7 or follow him on Twitter GarySingerLaw.
The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.