Despite signs of a housing market getting slower in terms of sales volume, prospective buyers are still interested in downtown San Diego lofts. In May 2019, online real estate giant Zillow announced a new program that intends to present all-cash offers to San Diego sellers. The program, which will be known as Zillow Offers, is expected to roll out in the beginning of 2020, and it will be geared toward sellers who want to skip the traditional listing process. There are a few reasons Zillow believes the time is right to introduce this cash purchase feature, one of them being that RealtyTrac reported more than 20 percent of all transactions in 2018 were settled in this manner. As can be expected, cash offers come with some caveats for both buyers and sellers—mostly for sellers. If you learn the owner of the downtown San Diego loft you’re interested in has received an all-cash bid, there are a few ways you can tilt the scale in your favor.
Retain the Right Professionals
Seasoned real estate agents consider cash offers to be similar to all other bids, which means they can be topped with the right amount of strategy and persuasion. You may not be able to think of a solid argument to beat an all-cash offer, but a real estate professional might. A sharp mortgage loan officer can also make a difference by quickly coming up with a preapproval document that can be presented and explained to the seller. Another useful professional to have by your side would be an appraiser who has a working relationship with the lender. If an appraisal can be completed soon after you make the offer, the seller is bound to look your way.
Lower the Mortgage Amount
If you’re able to convince relatives and associates to gift you a portion of the down payment, you may be able to get a conventional mortgage with an 80 percent loan-to-value ratio, which means it can be processed and closed rather quickly and without excessive conditions.
Eliminate Contingencies Where Reasonable
Getting to the closing table with a cash offer isn’t always a smooth process. Once prospective cash bidders realize they have the upper hand, they’re bound to demand certain conditions and contingencies. If you can reduce these contingencies, your bid will be more attractive, but it has to be reasonable. For example, eliminating the home inspection is never reasonable.
Enter a Higher Bid
A higher bid is probably the easiest way to get the seller’s attention, and it may not be as far-fetched as you think. Cash offers such as the ones Zillow plans to roll out next year are typically below market levels, and their commission fees tend to be higher than average, not to mention Zillow would deduct repair costs. The advantage of higher bids is that they hedge against future cash offers being made on the same loft.
Competing against cash offers can be complicated, so make sure to hire professionals with varied experience in every aspect of buying real estate in downtown San Diego. The experts from 92101 Urban Living can guide you through every step of the buying process so you’re able to get into your dream home as quickly and easily as possible. Call one of our friendly agents today at 619-649-0368.