First time home buyer house hacker

[Alfredo Sanchez]

I'm looking into buying a property with a sibling and renting out a portion of the house to help with the mortgage. We're approved and have been outbid several times on homes where we offered 15-20k over asking. 20K over asking on homes that needed bathroom and kitchen remodeling as well as other minor touches. Supposedly most of the houses we looked at always had 10+ offers so we took some time off from looking at homes in order to not compete with families who were looking into moving into a home before the new school year. 

My sibling and I aren't in any rush to buy a home but we're hoping to make a move soon and give it another shot in acquiring our first home. The question here is, should we wait for the market to calm down? Or pay top dollar leaving little room for future appreciation gains? 

Another option on the table is buying a short term rental property in the Poconos, PA on my own. The goal would be to generate equity in that home to than use in the future to buy a home on Long Island when the market is right??

Any other strategies I should look into?

[Abel Curiel]

Quote from @Alfredo Sanchez:

I'm looking into buying a property with a sibling and renting out a portion of the house to help with the mortgage. We're approved and have been outbid several times on homes where we offered 15-20k over asking. 20K over asking on homes that needed bathroom and kitchen remodeling as well as other minor touches. Supposedly most of the houses we looked at always had 10+ offers so we took some time off from looking at homes in order to not compete with families who were looking into moving into a home before the new school year. 

My sibling and I aren't in any rush to buy a home but we're hoping to make a move soon and give it another shot in acquiring our first home. The question here is, should we wait for the market to calm down? Or pay top dollar leaving little room for future appreciation gains? 

Another option on the table is buying a short term rental property in the Poconos, PA on my own. The goal would be to generate equity in that home to than use in the future to buy a home on Long Island when the market is right??

Any other strategies I should look into?

 Hello Alfredo, great questions!

First off, you are not the only one, this has been a common scenario for quite some time. Homes that are in desirable low-inventory areas that are also priced well are very difficult to put under contract. 

@Joey Banasihan makes some good points. Sometimes, its not about the offer but about the presentation behind it, the rapport and level of certainty the offer gives the seller, etc.

That said, its tough to compete with above asking (and sometimes all-cash) offers in this market.

A couple things to potentially consider (if you haven't already done so) are:

1. Escalation clauses - allowing you to automatically raise your offer by a predetermined amount anytime a higher-competing offer comes in.

2. Include your team on offer emails - lender, attorney, & home inspector availability. The lender can contact the listing agent to answer any finance questions; the attorney's info shows the seller you're ready to sign contracts asap; the home inspector's availability reassures the seller that you're not going to 'sit' on the deal once the offer is accepted.

I agree with Joey regarding staying in there and remaining aggressive. Tons of stories on the BP podcast and throughout these forums about people who landed a deal after 10,20,30 rejected offers.

All the best to you on your search!

Abel