How To Navigate a Market Where Multiple Offers Is the New Normal

If you’re thinking of buying a Boca Raton home today, you already know that the number of homes available for sale is low. But what does that really mean for you? As a buyer, low housing supply coupled with high buyer demand means you should be prepared to navigate a highly competitive market where homes sell fast and get multiple offers. Realtor.com has this to say:

“Homes also flew off the market at record pace as buyers put offers in the moment properties came up for sale….”

In a bidding war situation like this, doing everything you can to get ahead of the competition is a wise move. That’s because when you find a house in Boca Raton and submit an offer, it’ll likely be up against strong offers from other buyers. According to the latest Realtors Confidence Index from the National Association of Realtors (NAR), homes today are receiving an average of 3.9 offers. That’s the most offers we’ve seen in January for the last 5 years (see graph below):

To help you navigate bidding wars with multiple offers, an expert luxury real estate advisor is key. They know what’s worked for other buyers, what sellers are looking for, and how to help you prepare when it comes time to make an offer. Here are three tips to keep in mind that will help you make the best offer possible.

1. Know Your Numbers​

You should know making an offer at the home’s asking price may not be enough. Luxury homes in Boca Raton today often sell for more than their listing price. An agent can help you understand the market value of the home and what other homes are selling for in your area.

2. Be Ready To Move Fast​

Speed and the pace of sales are contributing factors to Boca Raton’s competitive housing market. When homes are selling fast, it’s important to stay on top of the market and be ready to move quickly. Your agent will help you stay up to date on the latest listings and help you put together your best offer as soon as you find the home you want to buy.​

3. Make a Strong but Fair Offer​

​When you’re up against other offers, putting your best offer forward from the start is key. Lean on your agent to write a strong offer and use their expertise on which levers you can pull to make your offer as enticing as possible. One option is to wave some of your contract contingencies (conditions you set that the seller must meet for the purchase to be finalized). Just remember there are certain contingencies you don’t want to give up, like the home inspection.

​Bottom Line

No matter what, your agent is your best resource for making an offer that stands out in a competitive market. Let’s connect to talk through what you can expect as a buyer and how to kick off a successful home search.

Tax Benefits of Homeownership

Tax Day is here, and if you bought a house last year then there are certain deductions you may be eligible for to help reduce your taxes. Below are some ways that you can help ease some of the burden of owning a home come tax time.

MORTGAGE INTEREST DEDUCTION

As a general rule, you pay more interest during the earlier years of you loan. With that taking advantage of this deduction could help quite a bit after your initial purchase. According to the IRS, you can deduct home mortgage interest on the first $750,000 ($375,000 if married filing separately) of indebtedness. This means the majority of buyers can deduct all of their interest paid during the year. The limitation here is that to be eligible for this deduction, the mortgage loan must be secured by the property as collateral and the proceeds of the loan must be used to build, buy or substantially improve your primary residence or second home. In short, that means this deduction is for homes that you live in, not investment properties.

REAL ESTATE TAXES

Another deduction are the taxes you pay on your property. The limit for this deduction is limited to $10,000; or $5,000 if married filing separately. To be eligible for deduction, this must be taxes from your state or local government that are directly used for the general public’s welfare. Any fees or taxes for projects that increase the value of your property, such as sidewalks, water mains, sewer lines, etc., are not eligible. POINTS Interest rate discount points are deductible on taxes. There are several questions that will need to be answered before deducting them, though. The questions are there to ensure that what are being deducted were truly points paid to reduce your interest rate and not other types of fees that are labeled as points to attempt to deduct them.

POINTS

Interest rate discount points are deductible on taxes. There are several questions that will need to be answered before deducting them, though. The questions are there to ensure that what are being deducted were truly points paid to reduce your interest rate and not other types of fees that are labeled as points to attempt to deduct them. 

PRIVATE MORTGAGE INSURANCE

If you were required to take insurance on your mortgage, it is deductible but the amount is dependent on your adjusted gross income. The PMI deduction is lowered by 10 % for every $1,000 a filer’s earnings are over the AGI restriction of $100,000. The deduction goes away entirely for the majority of property owners whose AGI is $109,000 or for married couples filing taxes separately $54,500.

HOME OFFICE DEDUCTION

One deduction that has become much more widely used over the last couple of years is the home office deduction. To be eligible for this deduction, you must be a small business owner, including self-employed people, who uses a part of their home as their primary place of business. This is not able to be used by remote employees who work for someone else. Like with any tax issue, all of these have their requirements and depending on your tax situation you may or may not be able to use some or all of these. For specifics on whether these deductions can or should be claimed on your taxes please reach out to your local tax expert.