In real estate industry terms, a seller’s market refers to the state of the local market when competition exceeds inventory, or when there is a greater number of buyers seeking properties than there are homes on the market.  It typically happens with less than 4-6 months of inventory available for sale. This situation can make the home buying process more stressful, which is why the friendly real estate agents at Priority Properties in Aurora, CO, want you to know the best techniques for success.

3 Tips for Successful Home Buying in a Seller’s Market

1. Pre-Approval on a Mortgage

Initial pre-approval from a lender is the key to proving to a home seller that you can afford a home loan for their property. The bank’s underwriters will assess your ability to borrow by analyzing your credit, capacity, and collateral. Pre-approval improves your chances of landing a property as financial security will also persuade a seller to accept your bid.

2. Home Should Be Under Contract Before Making an Offer 

In a seller’s market, it’s important to have as few contingencies as possible to make your offer more attractive. One of the most common contingencies that buyers have is that they can only purchase the home if their current property sells. This will not work in a seller’s market; it’s best to already have your home under contract to sell before making an offer on a listing.  Or better yet, have it sold so you are already liquid with your cash!

3. Have Extra Cash on Hand

While it used to be that having cash on hand would help you to get a discount on the asking price of a home, this is no longer as relevant. Appraisal issues are a common concern, and if there is an appraisal deficit, the buyer would be responsible for bridging that gap in a seller’s market. This makes having cash on hand a necessity, as it allows you to go above the appraisal price and prevents a lender from taking away their loan.

Whether you’re in a seller’s or buyer’s market, it’s crucial to have a real estate agent you can turn to for guidance. If you’re located in the metro Denver area of CO, trust the leading real estate agents at Priority Properties, as they have the expertise and experience required to help you land the best deal on a home. Contact their office today at (303) 263-2072 to schedule a consultation, or visit their website to browse their impressive selection of real estate listings.