When buying, should you make your purchase contingent or offer less?

So it happened. It finally happened. You found the right house. The location is great, the layout works perfectly for you and your family, there’s a two-car garage and so forth.

It’s great. But it’s not perfect. There are a few things that make you uneasy.

House hunting does not always end like a romantic comedy where, after a few blunders and errors, you manage to stumble upon the right home and it’s perfect in every way. No, unfortunately, there are sometimes a few defects and blemishes you’d like to see ironed out before moving in.

In these cases, you have two big choices before you: 1) Make a contingent offer that comes with a list of repairs you’d like them to make, or 2) offer less and take the house as is.

Let’s look a little closer at these options.

Making a contingent offer

If you want your home to be truly move-in ready when you put the key in the door, then a contingent offer might make sense for you.

Basically, a contingency clause outlines the condition of the house or the actions that need to take place for the deal to close. You can shape this clause any way (well, within limits) you and your real estate agent see fit. For this discussion, you would list the most crucial repairs or additions you would need to proceed with the deal.

If the seller accepts, that’s great. However, the danger in making a contingent offer is that, as you can imagine, sellers don’t like them that much. In most cases, they want to sell the property, not do more work. Therefore, an offer that is contingent on improvement or additional work could very well be turned down.

Offering a lower price

The other option is to simply offer a lower price. Factor in the amount of work you would have to do to get the property up to snuff and subtract what you would consider a reasonable (and competitive) amount from the asking price.

Whereas a contingent offer leaves more work for the seller to do, offering a lower price leaves you, the buyer, with more work. However, this also means you have more control and can make sure whatever work you want done is performed to your specifications.

Whether you make a contingent offer or make a lower offer largely depends on the market and the property you’re looking at. In a hot seller’s market, you probably won’t be able to get away with asking for repairs or additions and will have to adjust your offer accordingly. But if the property you’re looking at has been on the market for some time, you’ll be in a stronger position to negotiate.

If you have questions about your future dream house, contact a Coldwell Banker Hedges Realtor® today. With years of experience, they know houses and can help you with any of your buying or selling needs.

Blog Archives