The last two weeks have been a turning point for our real estate market. I have seen multiple offers on almost every type of property in Arlington but especially condos and (soon to be) townhouses. Here’s the dirt on what’s going on:
Where: The “affordable” price range in Arlington spans from $300k – $650k-ish. Basically anything in that price range is flying off the market, if it’s:
a) Priced correctly
b) In a good location
c) The only property of that type (i.e. a 1 bedroom in Clarendon)
d) In good condition
What: Condos are in high demand but low supply, there are nearly ZERO townhomes on the market, which means that as soon as either of these property types are listed for sale, they’re generating interest from every buyer who is waiting for something to become available. You’re going to be competing for the property, so make up your mind quickly if you want to make an offer.
How: My most recent experienced with multiple offers (which happened yesterday) was a condo in Ballston that got 5 offers the first 2 days it was on the market…the winning bid went $15k over asking AND did not include ANY contingencies in their contract (meaning no inspection, no appraisal, no nothing!). Reminiscent of 2005, isn’t it? While I don’t think we’ll return to that as standard practice, things like contingencies and down payment will start making a bigger difference, in addition to price (of course).
Tips to Win:
1) Put a larger deposit with your offer. If you have no plans on getting cold feet or defaulting on the contract, it’ll be a credit to you at closing anyway, but sellers feel “safer” when they know you have a lot of money on the line to show up a closing.
2) Do everything you can to make inspections and contingencies short. A 4-day home inspection period is much less risky for a seller than a 10-day period. They know you’ll have to make up your mind quickly if the condition is something you’re willing to accept, so they lose less time off the market in the event you void.
3) Know that if you’re doing an FHA loan, sellers are most likely going to pick a buyer with a larger down payment. Reasons for that are two-fold: first, you’re putting down 3.5% and likely don’t have much more cash if something goes wrong (i.e. a low appraisal or a long list of inspection repairs). The second is the length of time for an appraisal, the contingency on an FHA (and VA) contract runs the length of the contract up until closing day. A conventional loan usually has only 21 days for an appraisal, again limiting the length of time a seller is in limbo.
4) Find out what the ideal timeframe for a seller is for closing. Are they moving ASAP and therefore want to close ASAP? Do they need 60 days to find a new home? Being flexible on closing will give you a bigger advantage if they’re not going to have to pay an extra mortgage payment while the place is unoccupied, or you can give them extra time to figure out where they’re going.
5) If you put your best offer on the table, you do everything within your means and it still doesn’t get you the place…move on. It just wasn’t meant to be and something better will come along. I promise!
If you’re reading this and thinking you want to explore putting your home on the market, call me! Find out what your Arlington home is worth.