Are you a buyer or a waiter?

Where are you in the home buying process? Are you a buyer or a waiter

A buyer hires a buyer’s agent to represent them. They get pre-approved. They view homes, look at disclosures, and write offers.  On the “yes-no-maybe” spectrum, a buyer is a YES.

A waiter sometimes look at open houses. They say they’ll get their mortgage sorted out when they find a home they like. They think that every house, condo, or townhouse “isn’t worth it”.  Maybe sometime in the next 2 years they’ll see something they like, there’s no rush!  They are “happy enough” where they are and will volunteer that “we don’t have to move”.  On the “yes-no-maybe” spectrum, waiters are a MAYBE. And maybe usually means no – not right now.

In this Silicon Valley market, to be successful in home buying requires a strong YES. It demands a commitment and an understanding that no home is perfect (if you hit 85% or 90% of your wish list and it’s in budget, that’s a win!).  A lukewarm “maybe” translates into a no, because the pace is so slow and unmotivated that they just won’t be able to pull the trigger in time. The best homes sell fast and may not be around by the time your lender has a solid approval in hand.

Although the market is much cooler than a year ago, homes continue to sell for more than 100% on average, typically with multiple offers and few (if any) contingencies. Buyers submit their offers with proof of funds (bank statements), ALL disclosures signed off, often with a contractual obligation to put the 3% initial deposit in escrow the next business day after the offer is accepted. They may pay for a rush on the appraisal because they are moving fast for a quick close of escrow. Serious buyers know that if they don’t do these things, more serious buyers will, and they’ll lose out. Serious home buyers may throw in a free rent back for the seller after close of escrow.

In other words, they are “all in”. (more…)