When home buyers begin the house hunting process, they often don’t realize just
how many steps there are. From securing a loan to finding a property you love to
negotiating the purchase…it can feel like the process will never end. Luckily, if you’ve
made it to the offer stage, the finish line is finally within reach! Together, with your
agent, you can make a bid on your dream home and hopefully seal the deal. But in
order to improve your chances of getting the house, your offer needs to be as
strong as possible. Here are some things to consider as we draw up your contract.
Understanding What an Offer Contains
It’s important for buyers to understand the terms and conditions that a typical offer contains. In addition to the basics — like the address of the home and all of your personal details — the agreement will lay out the sale price, a target closing date, the amount of deposit you will be required to forward, and any other conditions you may be asking for. Your offer
will also give a timeframe during which the sellers need to respond. TIP: Most
buyers don’t realize the importance of having a realtor that has a good working
relationship with others in the real estate community. It doesn’t hurt when your
offer comes from an agent that is well respected amongst their peers.
Choosing a Price
The price of the home is what most people are concerned with, in regards to the
offer. Home buyers often have trouble deciding how much money to offer on a
home, which is why it’s very important to work with a real estate agent you trust.
Remember that the housing market determines how much a property is worth, so
your agent will look at similar homes that have recently sold in the area in order to
help you come up with a reasonable offer price. You should go into the negotiating
process expecting to receive at least one counteroffer from the seller. But this
doesn’t mean that you should start off with a low ball offer to see how flexible the
seller might be. This is especially true in Ottawa, where homes often
close with multiple offers. If you send a lowball offer, your offer probably won’t even
be considered. TIP: Most agents fail to contact the listing agent prior to submitting
an offer on behalf of the buyer. Speaking with the listing agent is the only way to
understand what the sellers are looking for so that you can make a solid offer.
Terms and Conditions
While price is usually the most influential factor when a seller decides to accept or
reject an offer, there are other terms and conditions that may impact
negotiations. Almost all real estate professionals suggest that you insist upon a
home inspection, for instance, so that you have the ability to back out of the
purchase if you find out the property has problems that aren’t obvious to the naked
eye. You may also want to write conditions based on your ability to secure
financing or the sale of your current house. Something as seemingly arbitrary as
your chosen closing date might make a seller more likely to accept your offer–
especially if they have already bought a new property and are anxious to move out.
As a general rule, you should choose your offer terms carefully based on the
specifics of the home you are considering. Make sure to find a balance between
making your offer as appealing as possible and protecting yourself against any
potential issues.
Seal the Deal
The final step, once you have come up with an offer you’re happy with, is presenting
it to the seller. Negotiations can often feel like a game of telephone as your agent
communicates with the listing agent, and then the listing agent communicates with
the seller. You have the right to back out of your offer for any reason up until it is
accepted. If the seller comes back with a counteroffer, you also have the choice to
either accept the agreement or write another counteroffer. Once both parties agree
on an offer, you will both be bound in a contract, and you may not be able to change
your mind without losing some or all of your deposit money. When you have finally
sealed the deal, the home will officially be “under contract” as you await your
chosen closing date. A signed contract essentially means that you have bought yourself a house, so you can congratulate yourself on finally reaching the end of a long process!
