The Madison area real estate market is super competitive right now, especially for buyers seeking an affordable property in a popular location. For example, we were recently involved with one local sale which received over 20 offers to purchase. Below we share a few highlights from this sale which show just how competitive the market can be during the spring real estate season.
Signs of a competitive real estate market
Here are a few more highlights from this ultra-competitive listing:
Every offer (except one) was for at or above the full list price.
One buyer submitted their earnest money with their offer.
Over half of the buyers who wrote an offer also wrote a personal letter to the seller.
One-third of the buyers specified a down payment amount of at least 20% in their offer.
About 10% of the buyers submitted a cash offer.
Half of the offers included a modified inspection contingency, where the buyers agreed to cover the cost of inspection-related repairs up to a specific dollar limit.
About 20% of the offers excluded an appraisal contingency.
About half of the offers included a modified appraisal contingency, where the buyers agreed to cover the difference between the appraised value and the contract price, up to specific dollar amount.
About 40% of the offers included an escalation clause, which increased the purchase price of the offer up to a maximum dollar amount based on the seller receiving other higher-priced offers.
And here's one we hadn't seen before: One buyer even had pizza delivered to the seller's house when the seller was in the process of reviewing offers.
Two tips for buyers in this year's competitive market
First, we recommend you hire an experienced and savvy buyer agent who will help you successfully navigate this year's market. Keep in mind our local market is made up of smaller submarkets, and depending on price point and location, some of these markets will be much more competitive than others. Your agent will help you understand the dynamics for your particular situation while helping you find and buy your perfect home.
Second, we recommend reading our article, 15 Ways to Write a Winning Offer. It covers some strategies for you and your agent to consider when you're writing an offer in a competitive situation.
Every situation is different
The example we shared above is an extreme example of how competitive the spring market can become. Most listings are not this competitive, however; and some listings don't involve any competition at all. A skilled buyer agent will give you the guidance you need to make the offer that's appropriate for your specific situation. To speak with one of our great team members, check out our agent profile page here. Our team is ready to go the extra mile for you in this year's hot spring real estate market.
This article is published courtesy of: Dan Miller, REALTOR Mad City Dream Homes & RE/MAX Preferred