Purchasing your first downtown Boston condo is a major life choice. For some, it represents moving out of your parents Beacon Hill home, that you may have been striving for, while others see their home purchase as a path to financial security

As a Boston real estate homebuyer, you have choices about how you approach the transaction. You can go it alone, without representation, or you can have a Boston real estate broker assist you. During your search, you may also find Boston condos for sale by the owner (FSBO) or via Boston real estate brokerage. Either way, you’ll eventually find the perfect home and you’ll want to make a competitive offer. Here’s how to make an offer on downtown Boston real estate that could actually win the deal.

Steps in buying a Boston Condo

There are steps you need to take even before you start your Boston real estate search to be in the right position to make an offer on a condominium.

First, you’ll need a lender’s pre-approval for a mortgage to know the price range you can afford on a Boston property.  A pre-approval letter from a lender will let you know how much a bank will actually lend you, and a best practice for any homebuyer who wants a seller to take them seriously.

Second, take some time to understand the Boston housing market. When you know the price range that homes are selling for, you’ll be able to have knowledge in your offer when the right home. 

As you search for Boston real estate for sale, you should try to understand the seller’s motivation if possible. A real estate agent has developed good strategies to learn more about what might be going on with a seller, so try and find out why they are selling and how quickly they’re looking to move. 

You’ll also want to ask about any repairs completed recently. This information is a standard requirement for a real estate agent’s listing agreement. If the seller is selling FSBO, they should provide the same information.

The Boston Condo Offer Process

The seller has three possible responses to your offer: accept it, counter it, or reject it outright. When the seller accepts or rejects your offer, you have a final answer and can move on to the next step by either proceeding with the purchase of the home or moving on to look at other houses listed for sale. However, when the seller makes a counteroffer, this is when a negotiation between you and the home seller takes place.

When learning how to make an offer on a house, you also need to know what an offer must include so that both you and the seller have appropriate protection during the course of the transaction.

 Always keep within your budget when purchasing a Boston condo

Budgets, as we all know are very important indeed, especially when we are committed to one of the single most expensive purchases of our lives and that is buying a Boston North End condo. This is why it is absolutely imperative that you take the time to understand your limitations. In other words, you should not be dazzled by a Boston North End condo for sale and end up purchasing it, knowing full well that it is beyond your means to do so.

If you were to do something like this, not only will you be saddled with chronic debt that you may not be able to pay off, but at the same time you might not be able to enjoy a lot of activities of the North End. So always make sure you have a well-planned budget once you decide to purchase Boston condos for sale.  Apart from that, you should also make sure that all post purchase, repairs and alternations are also included within the budget so that you would not need to borrow any excess amount from the banks and other financial institutions.

Boston Condo Purchase Plan Should Include:

This is an example of a rudimentary purchase plan that should be easy enough to follow:

  • Set the main criteria of the plan (such as number of rooms.
  • Do your research thoroughly
  • Define the main strategy
  • Conduct your due diligence
  • Get an appraisal by qualified consultants in the real estate market
  • Fine tune the list of prospective properties that you like
  • Make sure that you have done all of your homework and finally
  • Make an offer that the seller cannot refuse

 Make a Strong Real Estate Offer

If a real estate agent represents you, they’ll submit the offer on your behalf and will follow a standard offer template that includes all the key points. If you are making home offers on your own, you will want to put together a very specific offer letter.

An offer letter should include a few specific items regarding how you’re financing the home and the expected timeframe in which you hope to close. Your offer letter should include:

  • your down payment amount
  • the amount of earnest money you’re putting down (usually between 1% and 3% of the sale price of the house)
  • a copy of your pre-approval letter from your lender
  • it should also show a breakdown of the closing costs and who is responsible for paying each one
  • and the offer’s expiration date

You may also have contingencies on your offer that you need to specify in the offer letter as well. Contingencies give you a way to back out of your offer if certain conditions are not met. It should come as no surprise that sellers prefer offers without contingencies, so use them sparingly, but include some necessary ones to protect yourself.

The Four Main Offer Contingencies

  1. Appraisal: The lender’s appraiser must agree that the house’s value is equal to or greater than the sales price. Lenders can refuse to lend if the property appraises for less than the loan amount.
  2. Home inspection: A home inspection will provide a report about the condition and safety of the home at that point in time, plus any repairs that should be made. Should that report reveal major unforeseen issues with the home, you can reconsider your offer.
  3. Financing: The lender will go through the final approval process to ensure nothing in the buyer’s finances have changed before approving your mortgage loan.
  4. Selling a house: If you need to sell your current home before purchasing the new house, you’ll need to add this contingency as well.

Negotiating Condo Price and Terms

Depending on how the seller responds to your offer, you may have some negotiating to do. If you are working with a real estate agent, their expertise will be invaluable to effective negotiation. It’s important to know what points in your offer you are willing to bend on and which are non-negotiable. Approach this dialogue with the seller with a respectful and cordial attitude. Just remember that they want to sell and you want to buy, but there may need to be some give and take from each of you to reach an amicable agreement.

Home Inspection and Attorney Review

Once the seller accepts the offer, you’ll want to schedule the home inspection, home appraisal, and have an attorney review your final contract. These steps protect both parties from major issues with the house. They also protect the lender from approving a bad mortgage.

The attorney will have your best interests in mind as a buyer and help you understand all you have agreed to and the seller’s responsibilities before closing. Your attorney’s review could close the deal for you.

Closing on a Home

As part of the closing process, the title company will review all the public records for the property. They will double-check that all past taxes, utilities, and any liens against the house have been paid. If not, they will document outstanding items to settle before closing to ensure the property deed can change ownership.

When all the contingencies have been met and financing is ready, the closing can proceed. Your lender will transfer your funds to the attorney or your title company to finalize the house’s purchase.

Boston Real Estate and the Bottom Line

This is an example of a rudimentary purchase plan that should be easy enough to follow:

  • Set the main criteria of the plan (such as number of rooms.
  • Do your research thoroughly
  • Define the main strategy
  • Conduct your due diligence
  • Get an appraisal by qualified consultants in the real estate market
  • Fine tune the list of prospective properties that you like
  • Make sure that you have done all of your homework and finally
  • Make an offer that the seller cannot refuse

 

Click Here: Boston North End Recent Condo Sales Stats

Click Here: Boston Real Estate For Sale in 2020

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