How to Write a Powerful Real Estate Purchase Offer

Summary

In this real estate training video, Robert Rico emphasizes the importance of crafting a compelling offer for potential buyers. He discusses the significance of an earnest money deposit, suggesting 3% of the property's value to signal serious intent. Rico also advises on considering the listing price and the property's days on the market to determine a reasonable offer. He warns about the impact of contingencies on a seller's perception, noting that fewer 'only ifs' can lead to a more attractive offer, ultimately increasing the chances of acceptance.

Takeaways

• 🏡 The importance of making a good offer in real estate, especially for agents working with buyers, is emphasized.
• 🤝 Buyers rely on real estate agents for advice on making offers, highlighting the agent's role in facilitating successful transactions.
• 💰 The earnest money deposit (EMD) is crucial; a larger deposit, such as 3% of the property's value, signals a serious buyer.
• 🏠 The sales price or offer price is a critical component of a good offer, and matching the list price can be beneficial if the buyer wants the property badly.
• 📈 Market conditions, such as whether it's a buyer's or seller's market, influence how an offer should be structured.
• 📅 Days on the market (DOM) is a key factor to consider; a property that has been listed for a long time may have more room for negotiation.
• 🔍 Real estate agents should be knowledgeable about the property's DOM to advise buyers effectively on making offers.
• 📉 A property that has been on the market for a short time may not have much room for negotiation, making a full list price offer more appropriate.
• 🔗 Contingencies, such as selling the buyer's current home first or an appraisal contingency, can make an offer less attractive to sellers.
• 💼 Fewer contingencies in an offer make it more appealing to sellers, increasing the likelihood of acceptance.
• 📝 When advising buyers, real estate agents should consider the earnest money deposit, the property's price based on DOM, and the potential contingencies involved.

Q & A

What is the main topic of Robert Rico's video blog?

The main topic is 'How to Make a Good Offer' in the real estate field, specifically focusing on writing effective offers for buyers.

Why is it important for a real estate agent to know how to write a good offer?

It is important because buyers want a realtor who can help them make offers that are more likely to be accepted, which can lead to successful transactions.

What is the significance of the earnest money deposit (EMD) in making an offer?

The EMD shows the seriousness of the buyer's intent to purchase the house. A larger deposit can make the offer more attractive to the seller.

According to the script, what percentage of the purchase price is typically considered a good earnest money deposit?

A good earnest money deposit is typically 3% of the purchase price.

How does the listing price of a house influence the offer amount a buyer should consider?

If a buyer wants the house badly enough, they should consider offering at least the list price to show their serious intent.

What does DOM stand for in the context of real estate, and why is it important?

DOM stands for 'Days on the Market.' It is important because it can indicate how quickly a house is likely to sell and whether there is room for negotiation on the price.

Why might a seller be hesitant to accept an offer with a contingency?

A seller might be hesitant because contingencies, such as the buyer needing to sell their current house first, can create uncertainty and delay the transaction.

What is an appraisal contingency and how does it affect a buyer's offer?

An appraisal contingency is a condition in the offer where the buyer's purchase is contingent upon the property appraising at a certain value. If it doesn't, the buyer may have the right to walk away.

How can a real estate agent use the information about a house's DOM to advise a buyer on making an offer?

An agent can use the DOM to gauge the urgency of the seller and the potential for negotiation. A longer DOM might suggest more room for negotiation, while a shorter one might indicate less flexibility on the price.

What is the general advice given by Robert Rico for making a good offer without too many contingencies?

The advice is to minimize the 'only ifs' or contingencies in the offer to make the seller more comfortable, which increases the chances of the offer being accepted.

What are the key factors a real estate agent should consider when advising a buyer on making an offer?

The key factors include the earnest money deposit, the offer price in relation to the list price and market conditions, the DOM of the property, and the contingencies attached to the offer.