In today's crazy seller's market, this question is at the top of all questions asked by anyone who wants to buy a home in Frisco. There are many strategies besides price that have provided my buyers with a competitive edge to win when they are not paying cash for a home. First, the reason why cash trumps nearly all offers is less risk. Once a home is under contract, a seller plans their move and does not want to experience any last-minute surprises that result in their home having to return to the market and start all over with another buyer. In the loan approval processing, there is a risk the buyer's loan will be declined or the appraisal will be short of the agreed-upon sales price. The solutions that have become almost a necessity to combat these two issues are having the buyer fully underwritten and approved for a loan and for the buyer to offer a full appraisal waiver.
Other terms that further elevate an offer amongst several are a very short option period and a high option fee. Buyers also need to be willing to allow for a long seller leaseback period if the home is currently occupied. However, in the end, the key factor is the sales price. This past weekend, one of the two buyers I assisted, put forth a good and solid offer on a home in Frisco listed for $750,000. As expected, we were competing in a multiple-offer situation. Much to our dismay, the winning offer was a sales price of OVER $900k and that was not our offer! If current sold or pending comparable home data was considered, this house appeared to be slightly overpriced.
Recognizing we are in a highly competitive market, it is difficult for anyone to predict what it will take to present the right offer because we never know how much another buyer wants a home over other buyers. My advice includes the above strategies and more but in the end, I advise buyers that they should offer the highest price they are comfortable in the offering, carefully considering what other options they have or have seen as a comparison, what they can comfortably afford, and what they are willing to live with. The latter is usually the biggest struggle but it does become easier as a buyer has more experience in the current market.
