Finding the right Pittsburgh home you want to purchase is an exciting and nerve-wracking time. Preparing an offer is a balancing act. It would be so much easier if we had a crystal ball and knew exactly how to structure the offer.
There are many different variables to an offer to purchase. What should you consider when making an offer?
- Neighborhood sale trends
- Type of financing
- Amount of hand money
- Inspections and timeframes
- Seller concessions
- Closing date
After you have discussed your offer with your real estate professional and your lender, your agent will write up a formal contract, and you will need to sign it before it is presented to the seller. And then you wait!
Only to find out the seller has rejected the offer to purchase their Pittsburgh home.
It is heartbreaking for many buyers. Your real estate agent will try to find out what went wrong to help you understand.
There are several common reasons your offer is rejected:
The seller received a higher offer.
It isn’t unusual in the current market we have been experiencing to have a buyer offer thousands of dollars over asking. You may or may not know there are other offers on the table. If the listing agent is working in their sellers’ best interest, they will notify all buyers to provide their “highest and best” offer.
Your offer was too high.
You walk a fine line when offering a price over the asking amount on a Pittsburgh home. If you have an appraisal, the property must appraise at or above the sales price for many financing types. An appraiser will look at the most recent sales in the neighborhood that have sold. If the seller and their agent feel that there are not sales that substantiate the higher price, the seller may reject your offer to avoid a problem down the road with your financing related to the appraisal.
Type of Financing.
Some sellers do not want to deal with the additional requirements of certain types of financing. For example, they may feel that FHA’s guidelines for health and safety items are more than they want to address. FHA does have guidelines for the appraiser to follow, but some agents make this a bigger deal than it should be. My advice is to obtain the mortgage that works best for you and make an offer to purchase based on your needs.
You asked for too many concessions.
The seller will always look at their bottom line. If they are asked to pay for unusual expenses, buyer closing costs, or leave items such as not included appliances, they may reject the offer to purchase. Your agent will help you put together an offer that is beneficial to you and the seller.
The seller has unreasonable expectations.
The seller sets the price with the guidance of their real estate agent. Sometimes the seller feels their home is worth more than the comparable homes in the neighborhood. They may have a high mortgage balance, and they think they must sell at a higher price. Most sellers are realistic about market conditions and listen to their real estate agent’s guidance, but few are not. Your buyer’s agent will be able to help you determine if the seller’s asking price is unrealistic.
The seller may not flatly reject your offer, but they may counter on the terms of your submission. A counter-offer negotiation can go back and forth until both parties agree, or either party walks away from the negotiation.
The seller may also reject your offer on their Pittsburgh home without countering. If the seller has not accepted another bid, you may have an opportunity to restructure your offer and submit a new proposal.
The offer process can stir a lot of emotion in a buyer. Having a buyer’s agent who can help you balance your emotions and the financial considerations during the process is priceless.
The SAYHAY Team is ready to help Pittsburgh home buyers find the home of their dreams. We can’t guarantee it will be stress-free, but we strive to eliminate as much stress as possible.
Contact us at 412-303-3600 or email SAYHAYTeam@gmail.com.