Are You Tired of Losing Out on Real Estate Offers?
Are you making offers on homes you love but you have to sell or close on your current home first? This is happening to most buyers all over the nation, and the real estate market in Scottsdale, Cave Creek, North Phoenix, Carefree, Fountain Hills, and Paradise Valley are just as crazy, if not more so.
When we recently sold two of our personal homes, we received 18 offers in 1 1/2 days on one and around 8 in 1 day on the other. That means with the 18 offers there were at least 17 buyers that did not get the home they wanted. I know it's even more than that because several agents said their buyers loved our home but they didn't want to be involved in a bidding war.
We also had agents with buyers that were interested in our homes, but they had to sell or close first, so they would be contingent on either one of those items. Before they set an appointment, they asked if we would consider a contingent on sale or close. Multiple offers were already coming in so we said "no" to contingent sellers.
We had buyers going around their agents and calling us directly, begging us to accept their offers. I had to explain why we couldn't accept their offer, and one of the families called, texted, and sent e-mails. Unfortunately, they were FHA buyers and we were worried that the house wouldn't appraise at the highest offers we received - which were $25,000 over the list price. We knew the FHA buyers wouldn't be able to come up with the difference. I tried to explain that to this buyer, but I'm not sure he fully understood.
Why is the Real Estate Market so Crazy?
It's simple supply and demand. With the lowest amount of homes available for sale (many areas are showing the lowest inventory ever) and historically low interest rates, there are many more buyers than available homes for sale.
Buyers are offering to give sellers concessions! I've heard of everything from waiving home inspections to paying the seller's closing costs. It wasn't that long ago when buyers were getting their closing costs paid for by sellers - now it's reversed.
With a market like this, if you have to sell your home before you can buy a new one, your offer will go to the bottom of the pile. We always say any contract can fall apart, even a cash offer. But when you have a contingent offer on a sale or close, it's riskier. If a seller has multiple offers and they're happy with at least one of them, there's no reason for them to have to accept a contingent on sale or close.
Do You Have a Plan B?
If you understand that you have to sell your home first before you can be competitive in multiple offers on your next place, do you have somewhere to live temporarily until you find your next home? We had to do that.
We sold two properties and purchased one. We first sold our single-family home. Then we moved to our Scottsdale townhouse and sold that in a day. We stayed there until right before the closing on that one. We were lucky that my brother owns a beautiful 2nd home in Scottsdale. We stayed there almost a month while waiting for our purchase to close.
If you don't have anywhere to live affordably until you find and close on your next home, then keep reading. I have a solution for you, and it isn't an iBuyer that will make you a much lower offer than you'd otherwise get by putting your home on the Multiple Listing Service with a real estate agent and brokerage.
They call it Knock Home Swap, but I don't like the idea of the word "swap". You're not swapping one home for another. Knock is mortgage financing similar to, but better than, the bridge loans of years ago.
Knock will give you a mortgage on your new home while allowing you to stay in your current place, but you won't be paying two mortgage payments. Here is what Knock can do for you:
- With a Knock Home Swap, you get the convenience, certainty, and cost savings of buying the new home you want first and then selling your old one.
- Knock allows you to skip the stress and uncertainty of buying and selling a house the old way.
- Unlike traditional home sales, where you can miss out on your dream home while waiting for your current house to sell, the Knock Home Swap gets you into your new home first.
- With a fully pre-approved mortgage, you can put down a strong, non-contingent offer on your dream home, and win! You only pay your new mortgage—Knock covers the old one.
- You only move once, saving on rent, closing costs, and moving costs. Plus, you'll sell your old house fast for top dollar with up to $25,000 in home prep costs covered upfront.
- Knock lets you skip living through home prep and showings.
Selling a home isn't a fun experience, especially if you live there. Knock offers you the convenience of being able to move into your new home before having to put your current home on the market!
Knock will even lend you money to fix up your current home. Move into your new home and then take the time to get your current home ready to sell and make any updates and repairs needed - while you're already out.
I got my Knock certification after we made all of our moves. If I knew about Knock at the time I would have taken advantage of it. I know we missed at least one house we probably would have liked because we were a day late. We wanted to wait until our inspection period was over on our Scottsdale townhouse before we went out looking. That home sold in a day, so we didn't even get to see it.
Knock Can Help You Win in a Multiple Offer Situation
You will be a fully approved buyer, almost as good as cash. You will not be contingent on getting your current home sold and closed. We had at least 3 offers that were all $25,000 above our asking price. We chose the buyer that was fully approved - not just pre-qualified.
This doesn't mean you can come in with a low offer. You'll still have to be competitive, just like you'll expect buyers to be for your current home. But with Knock, you'll at least be in the running. Having to sell and/or close on a home first puts you at the back of the pack.
Even in a buyer's market, many sellers want to make sure they can find a decent home before they put their current home on the market. In today's Seller's Market, sellers are afraid they won't be able to find a home quickly enough, and they'll either have to settle for something they're not in love with or they'll have to move more than once - they'll need a Plan B.
A good Plan B would be to have family or friends that you can live with temporarily. Maybe you wouldn't have to pay anything or pay a nominal amount. But not everyone can or wants to move in with someone else.
Your only other options would be to get a short-term rental on a place, or worse, live in a motel/hotel. That can be expensive! And if you have pets, it could be difficult finding a place that allows them, or at least without extra cost.
There is one other thing that could happen, but it's unlikely you'd get enough time out of it. With this market, if you have a nice home that could sell in a short time period with multiple offers, you might be able to negotiate extra time to stay in the house after closing. But buyers usually need to get out of their current residence, so most aren't able to give you more than a couple of weeks if that. I've even heard of buyers offering sellers the ability to be able to stay in their homes without having to pay rent in this market. Personally, unless I had a Plan B (another place to go to temporarily), I wouldn't depend on this happening.
Do I have to pay two mortgages?
Nope! You’ll pay the mortgage on your new home, immediately building equity, while Knock helps cover your monthly mortgage payments on your old house.
What if my house doesn’t sell?
Before you buy your new house, Knock will issue a backup offer on your old house that goes into effect after 6 months, so you can rest easy knowing that you are covered—no matter what.
What’s the catch?
There is no catch, but don’t just take our word for it. You can read 700+ five-star reviews from our customers - ask Judy for the link.
How do I get started?
Call Judy to find out if you’re eligible for the Home Swap and get pre-qualified in just 3 minutes at knock.com.
What if I have more questions?
Call Judy Orr at 480-877-1549. She'll help you get answers to your questions.Posted by Judy Orr on