How To Write A Great Offer Letter To Get Your Dream Home - Page 13

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In April of 2020, housing prices actually increased slightly compared to April of 2019. At that point, it wasn’t quite clear how coronavirus would impact the housing market. Now, we see those housing prices going up and up. Is it that homes are becoming more valuable? In a sense, depending on who you ask, yes. But one big factor driving those housing prices is the increase in bidding wars happening.

The current low rates may have something to do with it, as so many buyers are rushing to take advantage of low interest rates before they go up. But, it’s all a balancing game. When interest rates are low, everyone wants to buy, so competition is high, and prices can increase. If you do want to buy right now, you may find yourself in a bidding war. You may be competing with someone who is able to offer just as much as you are, if not more. One thing that can make your bid the winning bid is a good offer letter. They are more powerful than you may think. We spoke with Leneiva Head of Welcome Home Realty in Nashville, Tennessee about how to write a great offer letter.

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Give your realtor some freedom

“The buyer’s agreement says the buyer’s information is confidential forever.  So the realtor can’t tell the buyer’s business without their permission,” says Head. That being said, it could prove beneficial to give your realtor permission to share something personal about you, in an offer letter, to appeal to the emotions of the seller.

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Putting the pieces together

Head talks about a few scenarios in which a realtor can get a sense of why a seller is leaving the home. Which can provide insight for the letter. “If your realtor has seen the house, they may have gotten a sense for the seller. The seller may still have those photos up. There’s a nursery with pictures of a baby…photos of Mr. and Mrs. Or a closet is packed out so you know they’ve outgrown the house.”

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Maybe this is your first family home

In the case of the example with the nursery and packed closets, Head says this can be an indicator that, this was the seller’s first family home, and now, they’re growing. They need a bigger space. They could like the idea of passing the house onto a buyer who will also use it as a first family home. “When putting that letter together, you’re building the story in a way that appeals to the seller – to their senses,” says Head.

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Representing first responders

If her client is a first responder of some sort, or a school teacher – who is also a form of a first responder right now – and the client will allow Head to do so, she will mention the client’s profession in the offer letter. This is a time when people want to support first responders. So talking about a first responder developing a love for a home can be very impactful.

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A touching story

Head created one letter for a teacher who was trying to get a foster child. She couldn’t have children. She couldn’t get a foster child until she had at least a two-bedroom home. Since the child was a boy, the rule is, the mother and child can’t share the same room. Head mentioned all of this in the letter, even stating there was a specific foster child the teacher had cared for for the past year that she was finally able to adopt, when she closed on a home. Head finished the letter by saying, “This is the perfect place for her to begin her new family.”

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The love and care will go on

In an effort to appeal to the seller’s attachment and love of the home, Head will mention in a letter how obvious it is that the seller has taken great care of the home and loves the home, pointing out specific evidence around the property that it was cared for. She’ll also state the client’s intent to love the home just as much as the seller did.

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Write with confidence

In writing a letter, Head advises using words like “when” rather than “if.” So it would be “When I move in” not “If I move in.” She suggests writing as if the deal has already been made. Head also recommends avoiding saying anything negative like “We know there’s a low chance that…”  She makes a total assumption that the client is getting their way and everything’s on the up and up. It helps that idea sink into the seller’s head.

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Don’t talk changes

Even though sellers naturally know their buyer will make changes to a home, they don’t want to think about that. “If they love the home, they don’t want to think about how you’re going to change it,” says Head.  So she discourages mentioning any changes you plan on making, in a letter. She also discourages mentioning anything very specific noticed during a viewing, like a college degree on the wall or location in a family vacation photo. That comes off as nosy, says Head.

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The follow-up

Once Head has written the letter, she reaches out to the seller’s agent, and tells them there’s an offer coming. She makes a point to also tell the agent the buyer’s story, over the phone, so the agent can feel the energy of it. “They can feel it’s authentic. It turns a piece of paper into a person, and makes them feel ‘We have to make this work’” says Head. “Relationships matter in this process. If you’re trying to have a successful letter, you have to take one step beyond the letter, and make that connection with that listing agent.”

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Money talks; but so does the letter

To prove how powerful a letter can be, it was more convincing than a better financial offer, in one case Head spoke about. She was working with a young man who could not offer more than the asking price, and even needed help with closing costs. There were competing (read: bigger) offers. The letter sealed the deal, which we’ll go over in the next slide.

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Connect the house to a goal

Head’s client was a man who had recently proposed to his fiancé. She had said yes, but he didn’t want to walk down the aisle until he had a home for them to build a life in, after the wedding. The client wrote the letter himself, stating “I’ve asked my bride for her hand in marriage and she said yes, but before we can say ‘I do’ I have to find the perfect home for my new family…”

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Bringing in nostalgia

Head’s client mentioned in his letter that the first thing he noticed about the house was its yellow door. His bride’s mother’s home, where the bride grew up, had a yellow door, so he instantly felt connected to the home. He said all this in his letter. “Fold those little connections into the letter.  Find that nostalgia,” says Head. For the client, it was important to find a home that blended with where his love story began.

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Dealing with investors

All of the advice about letter writing can be flipped on its head if the seller is an investor, and not someone who actually inhabited the home. “You can’t pull at an investor’s heart strings as easily as you can pull at a regular seller’s heartstrings,” says Head. But she does have a story of recently – in this pandemic even – helping one client win over an investor, even when he didn’t have as much money to give as the investor hoped for. Head was representing a police officer, during the pandemic. She wrote a letter on his behalf, that went something like, “Dear seller, I’d like to introduce you to buyer. He’s a first responder with the police department and he is making it possible for us to stay at home and be safe and well. He’s looked at your home, and in preparation to start his family, he has decided that it is the perfect home.”

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Appealing to a civic duty

Head added a surprising twist halfway through her letter, that was really a call to action. She wrote “He [the buyer] will not look at any more homes. We know that you may have several offers and your bottom line is most important. However, we ask that you give special consideration to the service the buyer is giving us on a daily basis as he risks his life for our safety. He can’t wait to move in to this home so that he can start his family.” These are all specific examples, but they do provide some idea of how a buyer can gather information about a seller, and connect what may matter to the seller, to details in the buyer’s life. They also show the true power of a good letter.