Is 2019 the year that you buy your new home in the greater Indianapolis area?

Many of your neighbors are having this same conversation around the dinner table. It’s fun. It’s exciting. The thought of changing where you live is like a fresh new start. How will our local market affect your plans for a new place?

The Housing Market is HOT

All the economic indicators point toward another robust year in the central Indiana real estate market.  The economy is good – job security is high – interest rates are still low – inflation is under control – wages are rising faster than home prices – there were 52,000 new construction jobs added nationwide in January 2019 – and the stock market just ended ahead for the ninth week in a row (the longest streak since 2009). Consumer confidence is strong!

Many people are in a great position to purchase their first home or move up to something larger.  And don’t forget the retiring baby boomers who plan to downsize.  2019 is shaping up to be another busy year for our local market.

A CRAZY Ride for Buyers

How will this hot market affect you as a buyer?

Similar to the last 3 years, it’s going to be a wild ride, so tighten your seatbelt!

Once again, demand for homes is expected to be very high and the supply of houses for sale (inventory) will be very low — driving prices up, driving real estate agents crazy, and driving home buyers all around town!  This lack of inventory is often called a Seller’s Market.

Why does inventory continue to be so low?  It is similar to the old chicken and egg issue….which comes first?  Current homeowners want to buy a new place before they sell their current house.  If they can’t find anything to buy, then guess what?  They also never list their current home.  See the dilemma?

It’s like dominoes.  (Remember how fun that was as a kid?  Stand them up one after the other, then tip the first one and watch them all fall.)  A $100,000 home sells and that seller buys a $150,000 home.  Then that seller needs a new place and buys a $250,000 home.  What does that seller do? They buy a $300,000 home.  Then, that seller… on and on it goes. You follow?  Once the dominoes start falling, they tend to fall very quickly.

How the RIGHT Realtor can Help You Win

It’s not easy to buy a home in a tight market, but having the right agent as your advocate can give you a competitive advantage and greatly increase your odds of success.  So, what qualities make an excellent choice for a REALTOR?

The Hoagland GroupResponsive

When inventory is low, homes sell quickly.  When a good one comes on the market your agent needs to be available to get you in to see it immediately.  Waiting until tomorrow may mean you completely miss out.


Your agent found the perfect home and you are ready to make an offer. Is your agent prepared?  Do they have the market knowledge to counsel you quickly about the property?  Your agent should come to the showing prepared with current market knowledge and property details which will impact your decision making.


Are they experienced enough to provide meaningful counsel in a hectic or frazzled environment?  Time is of the essence.  You are likely in a race with other buyers.  You need an agent who can provide specific answers and guidance from years of past experience.


Be sure the REALTOR you choose is also creative and able to think outside the box! You don’t want them to simply throw your hard earned money away when there could have been a different solution!  Knowing how to leverage terms and conditions can help you win against the competition – and not by simply ratcheting up the price!


How connected is your agent? Do they have resources to give you an edge? It’s possible, with the right team on your side, to make your offer stand out as a win-win for everyone. (Ask us about Keller Mortgage and the advantages we can offer you when using them.)

What YOU can do to Prepare for Success

Be Patient

When inventory is low and the number of buyers is high, you may need to submit several offers before you win.  Hang in there.  When you get your new home, it will all be worth it.

Be Prepared

When time is your enemy, it is important to have your homework done upfront.  The most important item is to have a mortgage pre-approval letter in your hands before looking at homes, so you are prepared to write a strong offer on very short notice.

Be Ready to pull the trigger

To win in a hot market requires a focused level of commitment.  Know what you want: what would be “nice” and what is a “must have”.  Then when you find the right match you will be ready to go.

If you need to think about it over night before making a decision, there is a good chance it won’t be available in the morning.  Perhaps you can think about it over lunch or dinner TODAY.  A clever agent may find a way to buy you that much time.

Winning Strategies – PRICE isn’t Everything

When the market is hot, you need to present a competitive offer to win.  What most people fail to understand is that it is about more than just price.

Man's Hands Signing DocumentWhen a seller is comparing several offers they evaluate all of the terms and conditions of each offer.  Here are some strategies our team uses to help our buyers win in multiple bid situations:

  • Submit your offer with the magic of an Escalation Clause

What is an Escalation Clause?  It is an amendment to the purchase agreement that tells a seller (in a multiple offer situation) that you will pay more for the home than other offers – but with specific conditions.

The list price for a home is $200,000 and you really, really want it.  It’s perfect:  down the street from friends; in the right school district; it even has the fenced backyard and community pool that were on your wish list!  You tell your agent ….don’t let me lose this house!  How could a escalation clause turn your offer into the winning option?

You submit an offer for the list price $200,000, but also attach an escalation clause that says you will pay $1000 more any other offer up to a max of $210,000.  The escalation clause allows you to enhance your offer, but with specific conditions.
What happens next? One of these three things are most likely:

If there are no other offers over $200,000 your offer would remain at $200,000.

If there is another offer at $204,000 your offer would be magically transformed up to $205,000.

If there is another offer of $211,000 your offer would be capped at $210,000. (You wouldn’t “win” in this case, but you won’t lose by over paying, either!)Pricing Your Home to Sell

  •  Don’t ask the seller for closing cost assistance

Over the years, it has become too easy and convenient (almost routine) for buyers to casually ask sellers to provide $2500 to $3500 in assistance toward their closing costs (most commonly lender fees).

Our advice?  Don’t do it, if at all possible. Requesting closing cost assistance is the # 1 deal killer in a multiple offer competition.

We’re talking about real money to the seller. Even if you raise the purchase price to account for those dollars, then the home has to appraise at the higher price.  That introduces added risk into the equation for the seller – which is often a killer in a multiple offer scenario.

If you don’t have the cash right now to cover the down payment and closing costs, don’t give up!  Consider other options such as a gift letter from a family member or let us to introduce you to Keller Mortgage as a lender option. They offer zero lender fees and up to $1,000 toward third party expenses at closing for Keller Williams clients!  (find out more)

  • Be flexible with the closing date and/or offer days of possession

If you have some flexibility, allow the seller to select the closing date or offer them a couple of days after closing to move their personal belongings. This enables the seller to make a plan that works for them – which can sometimes seal the deal!

  • Buy it “as is”

Another winning strategy is to purchase the property “as is”.  You can still make the offer contingent on an inspection and if something major arises you can walk away from the purchase and get your earnest money deposit back; however, the seller understands up-front that they will not need to make any repairs. This provides a busy seller with a level of relief that they won’t have to worry about messing around with minor inspection repairs.  This is a great tie breaker in a multiple offer situation.

  • Don’t ask for other unnecessary items

For instance, don’t ask the seller to pay for a home warranty.  Warranties go for $450 to $700 these days.  If you really want one, consider paying for it yourself.

Pick up the tab for the closing fee (a closing fee is what the title company charges to hold closing).  A typical closing fee is around $300 and can be a buyer expense, seller expense, or shared equally.  To make an offer more attractive, don’t add seller expense – take on the $300 cost and be more competitive.

Don’t ask for additional personal items like furniture, pool table, or the washer and dryer to be included in the sale, unless they are listed on the MLS as something the seller plans to leave behind.happy clients

  • Send a personal letter or note to the seller along with your offer

Sellers are often emotionally attached to their home.  They have built a life within those walls – holidays, dinners, family events, children, pets, and more.  They often say things like: I hope a young family buys this home and has as much fun here as we have had over the past 30 years.

Make it difficult for them to say no.  It doesn’t cost anything and we have represented sellers who selected a lower offer, just because a letter pulled at their heartstrings.  Here are some examples of things we have seen in letters:

  •  We can’t wait to bring our new baby home to this nursery!
  •  We will take great care with the annual flowers you have in the front yard!
  •  This home is perfect for when our entire family gets together each summer!
  •  My spouse is in the Marines, and when we saw the military pictures in the study we just knew this was the one!  It was like a sign telling us – here it is!


Consider New Construction

Ask your REALTOR if new construction might work for you.  It may take a few more months before you move into your new place, but you won’t be competing with other buyers, making the overall experience less stressful.

Your agent can show you homes from all of the leading builders in your area as well as provide meaningful counsel during your meetings with the builder’s representative.

Download our new construction booklet that outlines what we can do for you and explains how our services come at NO COST to you.

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