Strategies for Buyers in a Seller’s Market

As many Buyer’s have come to experience in this frantic real estate market throughout the Sacramento region, it’s a TOUGH time for Home Buyers.  Most listings are getting multiple offers, well over list price, and with Buyers coughing-up the payment of most,  if not all,  escrow and title fees. But don’t get discouraged!  I’ve been successful with a number of Buyers in getting them well-prepared going into negotiations which has brought them success.

Here’s what I recommend to my clients:

  1. Have a current pre-approval letter from a local lender.
  2. Get copies of your bank/investment statements to serve as proof of funds for your earnest money deposit and down payment.
  3. Write a personal letter about your family and what you appreciate about the home.
  4. Search for homes that are 1-2% below your maximum budget so that you can offer above-list price and still stay within your pre-approved loan amount.
  5. Evaluate the standard costs that Sellers & Buyers regularly pay within each county and agree to pick-up whatever cost you afford.  This can often be a differentiator as it affects the Seller’s Net Sheet.
  6. If you need additional funds for closing costs, consider offering ex: $5,000 over list price but request that the Seller provide “a $5,000 credit toward recurring and non-recurring closing costs.”
  7. Review the standard contingency periods and shorten them to provide a sense of urgency (and security) to the Sellers. NOTE:  Be sure to discuss the appraisal and loan contingency dates with your Lender.
  8. Have your Realtor and Lender each call the Listing Agent to “pitch” your offer.

SALE PENDING: After losing out on their first house to multiple offers well-over list price, we found, and got into contract on an even better home for Nick, Nicole and Amelia. Relocating from Louisiana to Beale Air Force Base they couldn’t be happier with this spacious, like-new home in Lincoln. I showed the house via virtual FaceTime tours + inspections with family members but they finally got to see the house first-hand on Sunday (I was a bit nervous that they wouldn’t like it).

Mortgage Rates Hit Record Lows. Could They Fall Even Further?


One of the few bright spots for home buyers and owners in 2020—a year marred by a pandemic, economic recession, social unrest, wildfires, hurricanes, and a highly polarized presidential election—has been rock-bottom mortgage interest rates.

Mortgage rates have been tumbling since COVID-19 disrupted the nation’s economy, achieving what many experts had believed was impossible: They dipped just below 3% in July. Rates have since fallen even further, reaching an all-time low of 2.86% for the average 30-year fixed-rate loan in the week ending Sept. 10, according to Freddie Mac. They ticked up to 2.87% in the week ending Sept. 17.

Those lower rates have allowed buyers to stretch their budgets at a time when home prices are on the rise. Homeowners who refinance their existing loans can potentially shave $100—or more—off their monthly mortgage payments, saving tens of thousands of dollars over the life of their loans. (The exact amount depends on the size of the loan and the previous rate.)

Now, many folks are wondering if rates can fall even further—and just how low they might go. The U.S. Federal Reserve pledged on Wednesday not to raise its own short-term interest rates, currently at around 0%, to give the economy a much-needed boost. So could that lead to mortgage rates dropping further?”That’s the big question. Are rates going to keep falling? Are they going to rise?” says Len Kiefer, Freddie Mac’s deputy chief economist. “The honest answer is, we don’t know. Economists have not had much luck in forecasting” where rates will go.

The problem is, 2020 hasn’t been a typical year. There’s never been a pandemic in our lifetimes, and this recession is driven by a virus, not a housing bubble or oil crisis or other economic trouble. And while mortgage rates are influenced by the direction of the Fed’s short-term interest rates, it’s not uncommon for them to, well, do their own thing.”Technically speaking, mortgage rates could go lower. Theoretically, they could easily drop to around 2%,” says Senior Economist George Ratiu of®. “However, for lenders [who set their own rates], the likelihood of rates going much lower is pretty slim. They don’t want to take the risk of a lower rate over the length of a loan.”

That’s what happened in March. Rates fell to around 3.3% in response to the coronavirus-induced upheaval in the financial markets, and homeowners rushed to refinance their existing mortgages. Lenders were so overwhelmed by the surge in business that they raised their rates to temporarily keep new refinances at bay as they scrambled to catch up.Refinances have since slowed to more manageable levels, and rates have fallen.

Why mortgage rates could fall even further—or not

For buyers, even lower rates could at least somewhat offset home prices, which have jumped just over 11% year over year, according to the latest data. Those low rates can bring previously unattainable homes within reach. So it’s understandable that buyers are watching eagerly to see which direction rates will go.“If we were to see the economy struggle a bit, that might cause rates to decline,” says Kiefer. “If the economy is stronger than we expected, they might rise a little faster.”So what’s going on? Bear with us here for a brief mortgage finance breakdown.

Rates are determined more by investors than by the Federal Reserve’s own rates. Lenders don’t want to hold onto the mortgage loans they make, as they want to free up capital to make new loans and profit off those. So they bundle up their mortgages and sell these mortgage bonds, aka mortgage-backed securities, on the secondary market to investors.When the financial markets are all over the place (like this year), investors will often pull money out of stocks and pump it into the relative safety of Treasury and mortgage bonds. These are considered to be safer, long-term investments. Now, mortgage rates are tied to the 10-year U.S. Treasury bond market. So when the bond market is strong, mortgage rates fall.And right now the federal government has committed to buying up mortgage securities, to stabilize the market in the face of this economic downturn. That’s led to a surge in demand, which also pushes rates down. “Investors are still clamoring for mortgage bonds because a weak economy and volatile stock markets make a lot of conservative investors nervous,” says Ratiu. “Bond investors are attracted to mortgage bonds, because the real estate market recovery is stronger than the rest of the economy.”

Kiefer points out rates have typically fallen by about 2 percentage points a decade. In the 2010s, they were around 4%. So they could, potentially, fall further into the low 2% range if they keep up that pattern.He believes rates might stay where they are, or fall just a little more, into the 2.75% range.“If you’re in the market for a refinance or a home purchase, rates can move very quickly,” says Kiefer. “The rate [you] see this week could be very different next week. There’s a lot of room for rates to move.”

That means buyers and those seeking to refinance need to have a good grasp of what the numbers mean for them.“You can wait for a basis point lower, but ultimately you have to weigh the trade-offs given the fast-rising prices,” says Ratiu. “Home prices are rising fast, so waiting for a lower rate is likely to have little benefit.”

Provided courtesy of by Clare Trapasso,  senior news editor of and an adjunct journalism professor at the College of Mount Saint VIncent. She previously wrote for a Financial Times publication, the New York Daily News, and the Associated Press. She is also a licensed real estate agent. Contact her at


6 Mistakes to Avoid After Mortgage Pre-Approval

Once you’re pre-approved for a home loan…STOP! Homebuyers: Be sure to follow these six simple steps while you’re home shopping and while you’re in escrow. Also, TIP #7: DON’T purchase new furniture, appliances, etc. until after you’ve closed escrow. Want to learn more:

Take a Virtual Tour

Whether due to your out-of-town location or the current Covid-19 shelter-in-place restrictions, there’s no reason to halt your search for the ideal home. Many current listing provide a 3D tour but working with me I can take the experience one step further. Let’s plan a Facetime call that allows you to see the home through the eyes of a professional Realtor. We’ll explore and address your questions in real-time. If you like what you see, we’ll move on to the next step of scheduling a safe showing at your convenience. Just another one of the concierge-level services that I provide.