Many people think home-buying bargains are gone, a casualty of the nation's gradual economic recovery. They reason that given rising home values, the only remaining areas where you can nail a good deal are those with high unemployment or urban blight.
But seasoned real estate specialists beg to differ. They say you can still find a quality home in a desirable neighborhood for a very good price -- assuming you take a strategic approach, find motivated sellers and exercise care in the way you craft your offer.
"There are always people who want or need to cash out of their house quickly because of divorce, financial problems or a new job in a faraway location," says Tom Early, a real estate broker who specializes in helping buyers.
As the headlines attest, median home prices have risen in many neighborhoods in recent months. And this past spring marked strong sales in many areas due to a shortage of inventory relative to supply. But since then the supply-demand ratio has shifted to a somewhat more balanced market.
"Lots of baby boomers are now coming out of the woodwork to sell homes they've owned for years," says Early, a past president of the National Association of Exclusive Buyer Agents (www.naeba.org).
He contends that buyers can often snag a deal if they find sellers who have a sense of urgency about letting go. It's also important to package your offer in a way that's unlikely to offend the owners, thereby reducing the odds it will be rebuffed.
The term "lowball offer" has bad connotations for real estate professionals, because ridiculously low offers are nearly always destined for rejection.
"An overly low offer punctures (sellers') pride," Early says.
To prevail in negotiations, Early says buyers should stay within a reasonable range of current market value with their first bid, recommending an offer of "no more than 10 to 20 percent off market value."
Here are some other pointers for purchasers:
-- Seek to connect with the home's sellers.
Because nearly all homeowners have emotional attachments to their property, most sellers react badly to any remarks that denigrate their home, says Fred Meyer, a longtime broker who sells property around Harvard University.
When shaping your offer, how can you convince the sellers that you sincerely appreciate their place and would value living there? Meyer suggests you attach to your bid a handwritten note that introduces you and tells the owners why you like the home.
"The idea is to humanize your offer. By writing a note, you help the sellers visualize who you are and what you like about their place," he says.
-- Attach a pre-approval letter to your offer.
In extremely popular neighborhoods, buyers currently outnumber sellers, and multiple bidding situations are relatively common. In those areas, Early says it's especially important to attach a mortgage pre-approval letter to your offer.
"Sellers don't want anything to do with buyers who can't prove they have the wherewithal to finance their house," Early says.
In fact, Meyer says it's often wise for buyers to attach bank statements showing they have the funds to take the deal to closing.
-- Don't forfeit your chance for a home inspection.
It's true that a condition-free offer represents a stronger bid and gives you an advantage over other bidders. Even so, Early urges you not to waive your right to a professional home inspection.
"People who don't get an inspection are at risk of buying a pig in a poke. Very few people have enough money to cover the costs of the horrendous house problems," Early says.
Are you competing with other bidders to buy a highly desirable property and want to present as condition-free an offer as possible? In that case, Meyer suggests you arrange to have your inspection done prior to drafting your bid.
"That way you can make a very clean offer without surrendering the chance to have the house checked out for problems," he says.
-- Keep in mind that timing is critical to motivated sellers.
Whether the sellers of a home are willing to deal with a low bidder often depends on how much pressure they're under to sell, Early says. Those in a rush are usually more willing to entertain a low bid, even if it means making a counteroffer to bring up the dollar amount.
"Timing is often the single most critical factor in getting a great deal on a house. Speed is especially important to sellers under duress who must move soon or face foreclosure. That's why the willingness to move quickly can strengthen your hand as buyers," Early says.
(To contact Ellen James Martin, email her at firstname.lastname@example.org.)