How to Write a Competitive Offer this Winter

November 8, 2021

As winter is creeping up, the temps are cooler, and snow is starting to fall, you may be wondering how to write a competitive offer this winter? First off, let me tell you that wintertime is my FAV time for buyers to enter the market or get back into it! As I’ve said before, winter is when we see less inventory hit the market and have fewer buyers competing for that same property. So instead of 14 offers on a home, there may only be 4 offers on a similar property, as we saw in the springtime. 

Now, don’t let this time of year get you off your A-game. If a property is updated, in a great neighborhood, and priced well, you can expect the home to fly off the market. So you need to come into each situation ready to write your best offer! So, what does that even mean? Let’s break down some competitive offer writing techniques! 

 #1 Increase your earnest money – This one is my favorite!!! Increasing the earnest money deposit, which is the good faith deposit you’ll follow through with the contract, is a great way to show the seller how serious you are about their home. For a seller, having a buyer put more money/skin in the game means they are serious! With your earnest money deposit going toward your total cash to close, it’s an easy tactic to use! 

#2 Pass/fail inspections – When you are up against multiple offers, a pass/fail inspection can be pretty dang appealing from the sellers’ side even in the wintertime! A pass/fail inspection notes that you, as the buyer, will still do your due diligence and get an inspection done but will not ask the seller to make any repairs. As the buyer, you are either taking the property as-is or walking away. Sellers love pass/fail inspections because it helps reduce their costs. As a buyer, you still get to understand the home and what needs to be done, so it can be a win-win for everyone when you are up against other similar offers. 

#3 Appraisal gap coverage: This might be one of the most used words of 2021 IMO. Appraisal gap coverage seems to be the norm these days. They say, “your offer is only as strong as the gap that you back it up with”. This means if the home does not appraise for the value that you are under contract at, as the buyer, you are willing to be $X more dollars to closing. While no one wants to pay more than what a home is worth, sellers want the coverage to protect themselves. When you look at the comps, you can tell right away if you’ll have an appraisal problem. Often, appraisals are coming in at the contract value, which makes this a risky but intelligent play to win the offer war!

#4 Find a property that’s been on the market for over 10 days – Ok, this one might sound too easy. But for real, this time of year, we start to see more and more price reductions as we get closer to the holiday season. While a home that came onto the market with spring/summer pricing sits for longer than a weekend, this is your opportunity to strike!! Homes that have been on the market for longer than 10+ days mean you may have a chance to come in under the list price, have no appraisal gap coverage, and have full inspection terms. Don’t let these houses scare you. Sometimes, depending on the weekend, a home won’t sell for no fault of its own. And once it makes it past a weekend, everyone else has the same thought, “what’s wrong with it,” and thus, the circle continues. Page through the MLS, because there is gold out there!!!! 

While winter is an excellent time to enter the market, do keep in mind, Denver is still very much so a seller’s market. So depending on the property, you’ll either need to pull out all the stops or maybe you find the unicorn that made it through a weekend. Either way, this time of year is the best time to start your house shopping adventure! And to snag those insanely low interest rates before the New Year! 

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