“Right now, sellers are in a position where they can direct buyers as few contingencies as possible,” said Ms. Newquist-Nolan, California broker. It’s a clever move, she said, because fewer contingencies mean fewer opportunities when a transaction can fall through.
Take home inspection for example. From September 2020 to February 201, Redfin offer winning 13.2 percent reduced inspection contingency from a year earlier to 0.3 percent, Brokerage report. (Such a contingency allows buyers to opt out of a deal if an inspection uncovered unexpected repair issues.) “Most buyers are waiting for a home inspection in our area right now,” Ms. Weathman said. “Pre-proposal inspections have become the norm.”
Most sellers are now open to allow buyers to bring in a home inspector before placing an offer on the home. A pre-offer inspection that detects some problems can convince a buyer to waive an inspection contingency, which can later make the buyer’s offer a more attractive option for the seller.
Buyers are also finding ways to forgive home valuation contingencies, in an effort to make their bid more attractive to a seller. (Appraisal contingency allows buyers to terminate a contract if the appraisal is below their offer price.)
“Some buyers who are holding down 20 percent are agreeing to reduce their down payment to pay the difference if there is an appraisal difference,” Ms. Weithman said. For example, in a deal where a buyer is offering $ 300,000 for a house, and has a 20 percent down payment, if the home is valued at $ 270,000, the buyer will leave their down payment by 10 percent. , And use that 10 percent in cash. To meet the lack of evaluation.
Compare apples to apples
Mr. Lejeune said that the best way that sellers can compare when they make an offer is to compare them.
His strategy: “I present offers to my clients in an Excel spreadsheet that specifies the offer price, loan amount, loan type, contingency and other important metrics,” he said. “This is basically a cheat letter for sellers.”