A lot has changed since 2011 when it comes to Real Estate market since 2011, but somethings have stayed the same. In June 2011 according to Mercury News reporter Pete Carey, close to 60% of residential transactions in Silicon Valley were Cash buyers! Now according to our recent research about 35% of sales in the past 90 days were cash buyers.
So, the question to ponder is how can we help our contingent buyers compete with Cash Buyers in the market. Here are some suggestions:
1) Research Seller: If your target home is a Bank Owned (REO) property, find out if the selling bank has any seasoning requirements on cash purchases. Some sellers now place deed restrictions on flips, so if this cash buyer will flip the house, then they might back away from these kind of restrictions and you might have a chance to win it with a solid offer.
2) Write a clean offer: You will need to write a clean offer with little or no contingencies to have a shot. So, don’t waste your chances by insisting on inspections or loan rate if you are serious about the house. Yes you are taking extra risk by not insisting on inspections, but the goal is getting the house at a reasonable price and no one said investing in real estate is without risk.
3) Rely on Relationship: Your real estate agent has to build a relationship with the seller’s agent. Ask your agent to submit your offer as a backup offer if the seller’s agent will consider it. Or if they don’t have such an option, offer them a chance to notify you if the cash buyer backs out.
Finally, it’s important for your real estate agent to know as much about the seller as possible. If the seller is going to rent after their sale, then your agent might score points by finding the seller a nice rental.
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