I am a hopeful property buyer who took a break from my house hunting earlier this year because the process was so competitive and frustrating. I hear the market has changed over the past few months. Is it true that I can write an offer on a house or townhouse that I like and have less competition? And could there be an opportunity to negotiate the price and terms?
Thank you, Jessy
Thank you for your excellent question. Every real estate transaction is made up of a variety of factors that influence the buyer’s and seller’s willingness to negotiate. Nationally, the real estate market has seen a shift in recent months. In the San Diego metro area, our inventory remains low, which is a benefit for sellers. However, we are seeing fewer offers being made on some homes and this could create an opportunity for buyers to have more ability to negotiate price and terms.
For example, in recent years, to be competitive, some buyers have chosen to remove inspection or appraisal contingencies from the bidding process. Buyers now typically write offers with inspection, appraisal, and other contingencies in place, and some sellers accept that. These contingencies give buyers time to do due diligence on the condition of the property and get their loan in place. In some cases, motivated sellers offer to buy out the buyer’s interest rate. This means that the seller will extend credit at closing to allow the buyer to reduce the interest rate on their loan by 0.25% or 0.50%, saving them money on their mortgage payment each month. If bids have not been received on a new listing in the first week or so, we see price reductions, and if there are multiple bids on a home, there are fewer bidders and their bids are not as far above list price as they were earlier this year.
We see in this evolution of the market an opportunity to be creative and to propose the best strategy for each of our buyer clients. Our years of trading experience and knowledge of the market allow us to place you in the most important position for that important purchase. Let us show you how we can work to find the best property on the best terms for you. It’s a great time to be a buyer!
Maureen and Antoinette