You’ve finally decided to purchase your first home and you have your sights set on a place in the city! But as you’re contemplating a condo vs. a townhouse, you see a new affordable listing for a housing co-op. It sounds intriguing, but you wonder,  “what exactly is a co-op?” and, secondly, “there’s no way this type of home is even popular.”

It turns out over 1.5 million people in the United States live in a housing co-op, and the concept has been around since the 19th century. Housing co-ops, also known as housing cooperatives or cooperative housing, are an alternative to homebuying where residents own a share of their community-controlled complex instead of actual real estate. While it can provide affordable living and less maintenance, co-ops may be harder to get into, and they can come with quite a few rules and regulations.

So is that co-op right for you? We’ve talked with a veteran real estate agent near a co-op hot spot and scoured pages of research to bring you everything you need to know on the non-traditional process before you jump in.

What is a housing co-op?

A housing co-op is a multi-unit tenement or complex where residents jointly own space and control the entire building. Instead of owning your unit outright, you own a share of stock or interest in your building and become a shareholder in the community. So, that means in lieu of a deed to your home — as you would have with a condo or single-family home — you have a membership contract or lease to occupy your dwelling.

Picture a multi-unit apartment building. Instead of all the residents paying rent to a landlord or management company, all the residents own the structure together as part of a corporation. They each own a share of the complex, which gives them the right to their individual unit and all the common areas. The number of shares you get is relative to the size of your unit. That’s essentially what a housing co-op is at a very basic level.

Depending on the co-op’s size, an elected board of directors (made up of residents) may run the complex and provide all the rules and regulations. They also handle all the financials and management operations. Or, if the building is small enough, the residents run the day-to-day activities themselves. Either way, there’s more of a community-centric focus and lifestyle compared to more traditional residences.

Sound confusing? It can be at first, but that’s why it’s essential to know all of your facts about co-ops, including the different types, before making any decisions.

Different types of co-ops

• Market-rate: One of the more common types of co-op, the buying and selling of these units are just like any other property. You can purchase or sell shares at any price in the market, and you build equity (or make money off a sale) just like a normal transaction with a condo or single-family home.
• Limited-equity: This is another popular type of co-op, and it’s geared for affordable living. There are more restrictions on the prices at which units are bought and sold. As the name suggests, you can still build equity in these co-ops, but there are more rules you need to follow to keep the prices low for yourself and future residents.
• Zero equity/group equity/leasing co-ops: A housing cooperative in which the co-op leases (instead of owns) the building. Because the corporation is renting from whoever owns the building, there’s no equity to be built. However, these co-ops are usually still run the same way as the other types.

Where are co-ops found?

Housing co-ops are found throughout the U.S., but they are most commonly located in the Rust Belt; major cities, such as San Francisco and Fort Lauderdale; and the Northeast. In fact, New York City itself accounts for about half of all the housing co-ops in the country, according to Co-operative Housing International.

While most co-ops are mid-rise or high-rise building complexes, a housing cooperative can take any shape and form. Here’s a look at what you might find.

What’s different about buying a co-op?

Like a co-op lifestyle may be different from other housing developments, so is the purchase process. The most significant difference is there’s usually an application required to get in. But before you have flashbacks to your college entrance process, let’s take a closer look at the timeline you can expect to see.

Home search and offer

This step is actually pretty standard, but it’s important to work with a real estate agent who has experience with co-ops. They will be invaluable during your home search, guiding you through what questions to ask and how different co-op boards of directors compare to each other. As for the offer, it’s similar to the process in condos and single-family homes as well. You’ll need a pre-approval letter if you’re getting a share loan (more on this in a minute), and you will gather all necessary documents (offer letter, purchase agreement, etc.) alongside your agent.

If your offer is accepted, be prepared to put together an extensive package of documents, including information on your financial and housing history, for board approval.

Co-op application

The exact process to get into a housing co-op will vary, depending on the cooperative itself and your location. However, there’s usually an extensive amount of paperwork where you’ll have to provide many personal details. After that, you’ll also be asked to interview with the co-op’s board of directors.

The interview could range from a simple formality to a lengthy back and forth, but remember, the board just wants to make sure you’ll be a good fit for the community, and you know exactly what’s required for the cooperative. Some example questions they might ask:

• Why you want to live in the co-op or that location
• What your employment history is and if your job is secure
• What your finances and financial history look like
• If you plan to have guests over frequently
• If you plan to make any renovations to your unit
• If any hobbies or lifestyle habits might cause issues in the building
• Questions to make sure your application and interview line up

The board may have legal grounds to reject your application based on financial issues, employment troubles, or even an unwillingness to follow the rules and regulations. However, since the Fair Housing Act, they can’t reject you based on age, race, sex, familial status, disability, or other discriminatory factors.

Overall, the board of directors wants to make sure you’re going to mesh well with the other residents, and you’ll pull your own weight. Plus, this is a great opportunity for you to figure out if the co-op — and it’s management — is a good fit for your needs!

Financing a co-op

You’re through the application, and you have all green lights to purchase your shares in the co-op (woohoo!). Now there are a few things to know about financing.

It’s not much different from buying a conventional property. However, you’ll have to get a co-op mortgage loan, also known as a share loan. These allow the purchaser to buy shares of the cooperative instead of buying the property itself.

It’s important to note that not all lenders provide these loans. If they do, you might be limited to purchasing in a market-rate co-op. This is because it’s easier for the bank to base the value of the loan on your market-based purchase price (as opposed to limited-equity co-ops, where the purchase price is capped).

The initial steps to receive a share loan are pretty standard. The lender will look into the details of the co-op, including the building’s age, size, management, and recent sale prices. They’ll also dive into its finances, examining the co-op’s cash reserves as well as the underlying mortgage (if it has one).

For the purchaser there may be a little more work, says Ed Verdel, a New Jersey-based real estate agent with over 11 years of experience. He says some co-ops or loan providers may require a 20% or more down payment before a purchase, and you might have to prove you have more cash in savings. On top of that, there might be more strict requirements on your debt-to-income ratio.

“Financially, it’s a little bit harder to get in than it would be into any other sort of purchase,” Verdel says.

This is also a good time to look into the co-op’s monthly fee, usually known as a maintenance fee. This can be higher than traditional condo associations, says Verdel, and it may be a burden. However, the fee covers communal expenses (repairs, landscaping, taxes, etc.), so that means you won’t have to do any of the work outside of your unit.

There also might be an underlying mortgage on the building itself, which the cooperative takes care of. If so, you might be responsible for a share of the cost, which adds to the maintenance fee.

Living in a co-op

A housing cooperative may be right up your alley, or it could be the farthest thing from what you’re looking for. To find out, let’s take a look at some of the advantages and disadvantages.

Advantages

Affordability

One of the most significant advantages of a co-op is its affordability, especially in limited-equity types. These co-ops provide affordable housing to low- or middle-income homebuyers and allow buyers to purchase in an area that might be out of reach going the conventional route.

Even outside limited-equity co-ops, the purchase price is usually lower for other types of co-ops since they might not have the amenities you find elsewhere. On top of that, you’ll save money on closing costs. You won’t need to pay for all the same fees as in a traditional transaction, like title insurance or a mortgage recording tax.

Another plus: You won’t have to pay expensive, individual real estate taxes like on a condo or single-family home. Since the building is owned by the co-op, the complex is taxed as a single unit; you’ll just have to pay a share of the bill, which is included in the maintenance fee.

Community-focused

When you purchase a co-op unit, you’re investing in a community. Everyone has a real stake in their building. That means you’ll get to know your neighbors well, and you’ll have a real say in the operations of the cooperative.

Plus, because the vetting process is so detailed and requirements are so strict, co-ops are usually more financially stable. If it’s well-run, the cooperative will most likely have a larger reserve fund, and their owners are less likely to go into default in down markets. That was the case in 2007, when the Great Recession didn’t hit co-ops as hard as other real estate properties.

Less maintenance

Since co-ops are so community-focused, everyone pitches in. Maintenance fees cover all the communal expenses, and you shouldn’t have to worry about repairs, security costs, landscaping, and other maintenance woes, at least in the common areas. That means one less thing for you to worry about in homeownership, which may be especially great for older buyers.

In smaller co-ops, you might still be responsible for some communal maintenance, but if so, your fees will be lower.

Disadvantages

Harder to get into

We’ve already mentioned the application process and interview necessary to buy into a co-op. This can not only put people off but also drastically limit the types of buyers able to get into a co-op. The financial requirements are strict, and everything from debt to employment history to your savings is looked at in detail.

There’s an estimated rejection rate of about 3% to 5% in co-ops, according to The New York Times. That might not seem like a lot, but, remember, that’s already after the seller accepted your offer.

More restrictions

Just like an HOA comes with rules and regulations, a co-op comes with them too — and then some. Many housing cooperatives have strict rules and bylaws to ensure everyone is comfortable and the co-op operates without issues.

Verdel says the exact restrictions depend on the co-op, but it could range from the inability to rent your unit to board approval for renovations to approval for certain pets. It’s essential to carefully review the bylaws and regulations before completing your purchase to make sure it won’t affect your day-to-day living too much.

High fees

Verdel says he gets clients all the time who are excited about a low-priced co-op they’ve seen. However, he cautions them to take a hard look at the maintenance fees. This fee might include communal expenses, management costs, taxes on the building, utilities, and any other board-approved costs.

It can get expensive, too. For example, the average maintenance fee for a co-op in New York City is $1,500 a month. Multiply that by 12, and you’re looking at $18,000 a year in maintenance costs. That’s more than double the typical annual costs for conventional home maintenance.

Before you purchase

As with any purchase, it’s important to ask the right questions before investing your money in a co-op. After all, they’ll most likely interrogate you before you’re accepted, so it’s only fair to ask them for some information.

Verdel says it’s good to ask what precisely the monthly fee is (and what it includes) and what the sale history looks like in the community.

“[You’ll] want to know that upfront just to see if it’s been increasing in value over time or if they’ve been depreciating in value over time,” Verdel says.

Some other important questions to get answered:

• How is the cooperative managed?
• How active is the board of directors, and do its members have the relevant experience to manage a co-op?
• Is there an underlying mortgage? If so, what does each shareholder pay toward it?
• What are the rules and regulations?
• Are there other additional fees to be aware of?
• Are there renovation restrictions?
• Are there pet restrictions?
• What is the community/resident engagement like?

These are only a few of the questions you might ask during your co-op search, and each process is different. After getting all the relevant information, you might find more traditional housing is a better fit for you. Or you’ll learn a housing co-op is the type of living situation you never knew you needed.

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Picture yourself in a true modern farmhouse, gazing out the window as your horse grazes nearby. You go to the henhouse and get a few fresh eggs for breakfast. Later today, you’ll check the vegetable garden or the vineyards to see how they’re doing, then take a horse ride.

If an idyllic life in the country appeals to you more than the thought of running a working farm, a gentleman’s farm, hobby farm, or ranchette might appeal to you.

We’ve investigated gentlemen’s farms, talked to a real estate agent who sells country properties, checked tax laws, and looked at dozens of listings to provide a complete overview of this niche real estate market. Read on for the answers to all your questions about gentleman’s farms.

What is a gentleman’s farm?

The term gentleman’s farm dates to when wealthy men owned a country home that doubled as both a summer retreat and a place where someone hired by the gentleman-owner would grow produce and raise livestock for the family. The New England Historical Society points to George Washington as a historical example of a gentleman farmer.

Today, the idea of a gentleman’s farm is similar. It’s a country property with acreage whose owners don’t need to run a farm to make a living or put food on the table.

The owners may have a job in the city or other sources of income. They may dabble in some agricultural activities for fun, or they might choose to leave most of the land in a natural state. Some may rent out the fields to working farmers. And some owners of gentleman’s farms are environmentalists who are introducing sustainable farming methods or practicing conservation methods to restore and preserve the natural landscape.

Around Houston, the common term for such properties is “ranchette,” says Mary Stewart, a real estate agent in Sugar Land, Texas. She has worked with 82% more single-family sales than the average agent in her market.

Generally, she finds buyers are looking for a place with a large home, a pond so the kids or grandkids can learn to fish, and room to drive an off-road vehicle. Buyers prefer 50 to 70 acres because “if you have 5 acres, you have to keep it impeccable, but if you have 50 acres, you just have to keep the acre around the house impeccable.”

Many buyers want the property as a weekend getaway space, she adds, and prefer a place with a caretaker, so it’s less work for them.

How do I find a gentleman’s farm for sale?

Farms are generally located in rural areas, so that’s the best place to look for properties for sale. Take an old-fashioned Sunday drive to the farming regions of your state to get a sense of what country life is like.

Get details about country life

If you’re a city or suburban dweller dreaming of country life, it’s a good idea to assess how much your life could change if you live full-time in a rural area. Ask yourself:

• How long of a commute are you willing to put up with? Do you have the option to work remotely?
• What kind of amenities do you need nearby? You’re unlikely to find big supermarkets, specialized doctors, shopping malls, and full-service restaurants in most farming communities.
• What are your high-tech options? If you’re going to work remotely, or simply like to stay connected, check what cell phone reception and internet speeds are available.

Location considerations

As you search for possible locations, there are other factors to consider.

How accessible is the area?

Could heavy snow prevent you from getting to work or trap you at home? If the region is prone to heavy winds or storms that can knock trees over, are alternative routes available if a road is blocked?

Are there any natural areas or resorts nearby?

Finding a property near a national forest, state park or resort area can bring many benefits:

• Touristy areas attract amenities (like restaurants) that you don’t find in most rural areas.
• If your property abuts a conservation or wildlife management area, you don’t have to worry about development in your backyard.
• The property may be easier to sell in the future.

Talk to local agents

Once you’ve narrowed the area for your home search, meet with a local agent to discuss your wants and needs. An agent who knows the community is best-suited to find an available property that suits you.

The property may not be listed as a “gentleman’s farm,” “hobby farm,” or a similar term in the MLS, so local knowledge is essential.

Stewart recommends working with an agent specializing in country properties who understands issues such as water rights. Such an agent will likely have access to a four-wheeler and can drive you around all the acreage, she adds. Without touring it on a four-wheeler, you probably won’t be able to see all the land.

Factors influencing the price of a country property include the value of the existing house, acreage, location, other facilities (such as a barn), and water availability, such as a pond.

What should I know before buying a gentleman’s farm?

When you buy a farm, you may encounter some issues and concerns you’ve never had to worry about.

Tax issues

If you’ve owned a home previously, you’re familiar with property taxes. However, property taxes for agricultural land are different. Agricultural property tax rates are usually lower than the tax rates on a home in a subdivision. Agricultural exemptions are designed to help keep farms in business.

How the land is used determines its tax classification. Because property taxes are a state or local issue, the rules vary by location.

To be assessed at the agricultural rate, Ohio requires that 10 or more acres be used exclusively for commercial agriculture purposes. If less acreage is farmed, the farm’s gross sales must meet a minimum amount for the property to qualify as agricultural.

In Georgia, land used for agricultural purposes is assessed at 75% of the value of non-ag property. Acceptable uses include horticulture, forestry, dairy, livestock, and poultry.

Texas, and some other states, impose rollback taxes if agricultural land is developed for another use. In Texas, you could owe three years of taxes covering the difference between the agricultural value of the land and the higher market value if you change how the land is used.

Talk to a tax specialist who’s familiar with state agricultural tax rules. If you’re planning on turning a working farm into a gentleman’s farm, you may face higher taxes than expected. A tax expert can advise you whether renting out some fields or another action might help you preserve the tax break. (Keeping just one horse or a few chickens probably isn’t enough.)

Finding a way to maintain the agricultural tax rate can save an owner thousands of dollars a year in property taxes, Stewart says.

Water and mineral rights

You should also investigate what water and mineral rights come with the property. In some cases, you will likely need the advice of an attorney.

Water rights

In some states, you might not have the rights to water that flows by or through your property, such as a stream. If you don’t have the rights to that water, you can’t use it for your livestock or to irrigate fields.

To make it more confusing, the rules governing groundwater tapped by a well may be different than rules for aboveground running water.

Mineral rights

Most of us aren’t expecting to find oil or iron ore on our property, so mineral rights don’t seem like an issue. But if you’re buying acreage in an area where minerals are commonly found and extracted, it makes sense to determine if the mineral rights have been conveyed to someone else. Contact a lawyer in the area who specializes in mineral law.

Issues like water rights and agricultural exemptions make purchasing a gentleman’s farm more complicated than buying a suburban house.

Potential buyers should also be realistic about what it takes to run a farm, cautions Stewart, who owns a 160-acre farm. “You’re going to work hard unless you get a caretaker.”

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When people begin their home search they often face an important decision: Would they rather live in a city bustling with bars, restaurants, and a vibrant arts and culture scene, or is it more important to live close to nature, where they can go for long hikes and spend the weekends kayaking in local lakes or rivers?

But what if you could find a home that combines city life with a plethora of gorgeous parks and beaches?

Madison, Wisconsin, combines the perks of living in a big city with the beauty of the natural world more commonly associated with rural areas. The city ranks on Livability’s top 100 places to live, largely due to its local food scene, 5,000 acres of parkland, 11 beaches, short commute times, and the state’s low cost of living. The average Madison resident commutes only 15 minutes, with many opting to walk or bike — rather than drive — to work.

If you’re ready to buy a house in Madison, get ready for a competitive real estate market where houses sell in less than a month. Madison sellers, like the city itself, are family-oriented and a personal touch like a buyer love letter, coupled with a competitive financial offer, can go a long way in helping buyers secure the home of their dreams.

To assist you with your home search, we’ve compiled this complete guide on how to buy a house in Madison, with help from local real estate experts whose insights and advice can help make your offer stand out amongst the crowd. We’ve also consulted local newspapers and available data to help you better understand local real estate trends.

Why are buyers sold on Madison?

Homes are affordable and hold their value

Home values in Madison have risen for the past seven years. In 2019, the average home price topped $300,000. In 2020 sales in Dane County, where Madison is located, were up 19% over 2019, and the median price jumped 10%.

“It’s always been a desirable place to live. It’s a beautiful city,” says Dan Chin, a top real estate agent in Madison with eight years of experience in the field. “We have quite a bit of pent-up demand.”

In addition to rising home values, the average Madison home is slightly less expensive than $313,000, the U.S. median home price in February of 2020, according to the National Association of Realtors, making it a great place for people to find an affordable home that will grow in value over the years.

A neighborhood for everyone

Madison is a smaller city at just over 250,000 residents, but that doesn’t mean it doesn’t have plenty of attractions. Home to the state capital and the University of Wisconsin-Madison, the city has plenty of restaurants and small businesses. Its top neighborhoods cater to everyone from young professionals to families. The market is dominated by single-family homes, but condos and townhouses can be found in neighborhoods closer to the university and the state capital.

“There’s a very high quality of life, with the lakes and state parks and the bike trails,” says Madison home inspector Jill Hauk, who’s lived in the area for 16 years. “And there’s a good food scene, good beer brewing scene.”

Willy Street

Also known as Marquette, this neighborhood located on Madison’s Williamson Street is home to some of the city’s best local shops, restaurants and live music venues, including a pig in a fur coat Mediterranean restaurant and Crystal’s Corner, a bar that frequently features live music. While townhomes and condos can be found in the area, it’s best known for its historic homes with a variety of architectural styles, ranging from Greek Revivals to Arts and Crafts bungalows. The neighborhood’s young, bohemian vibe is perfect for professionals just starting out.

Tenney-Lapham

One of Madison’s largest neighborhoods, Tenney-Lapham is also extremely livable. AreaVibes gives the neighborhood an excellent rating, earned by its upscale atmosphere. High-rises, condos, and apartments are common in this neighborhood as it grows to match the rest of Madison’s East Side. Music lovers will embrace the area as it is home to two of Madison’s best venues — the High Noon Saloon, which features mostly indie acts and local bands, and Breese Stevens Field, which has hosted shows from country music star Darius Rucker to pop rock duo Hall & Oates.

Wexford

Wexford is considered the top neighborhood in Madison, according to AreaVibes. Wexford offers residents easy access to public transit, great schools, and proximity to several large parks, including Stricker’s Pond Conservation Park. The close-knit neighborhood is ideal for families who can enjoy events like the annual Fourth of July Parade and Picnic and the end-of-summer potluck picnic.

Westmorland

If you want to buy a house in Madison to take advantage of the city’s wide array of outdoor recreational offerings, then Westmorland is the neighborhood for you. The area is named for Westmorland Park, which offers residents nearly 12 acres of green space and an extensive network of bike trails linking it to University of Wisconsin-Madison’s arboretum and downtown Madison. Westmorland is also home to seven of the city’s Lustron homes — a unique style of home made from prefabricated porcelain steel.

Shorewood Hills

Shorewood Hills is another neighborhood built for outdoor lovers. Dedicated to wildlife preservation, Shorewood Hills is home to nine parks and shares a border with Lake Mendota. It’s not uncommon to see residents kayaking and water-skiing as well as hiking and biking. Its A+ rated schools make it an excellent choice for settling down and raising a family.

Vilas

Vilas is one of Madison’s historic neighborhoods. With its abundance of greenery and lines of Victorian and Tudor homes, you’d never know that this quiet, family-oriented neighborhood is located on the edge of the University of Wisconsin-Madison’s campus. Walking to the Henry Vilas Zoo or taking a jog along the 6-mile Lake Wingra loop are just a few of the neighborhood’s many perks.

Plenty of outdoor recreation

For those looking for a city that provides access to the great outdoors, Madison should be a top contender. The city is home to four lakes, numerous parks, and a plethora of biking and walking trails. Residents can be found water skiing or kayaking on Lake Mendota and strolling through 16 acres of flowers, trees, and wildlife at Olbrich Botanical Gardens.

A perfect place to raise a family

In addition to great parks and an active downtown, Madison and the surrounding area sport a number of A-rated school districts, making it a perfect city to raise a family. Waunakee High School, which is the No. 1 school in the Madison metro area, is the 10th best school statewide, per U.S. News and World Report rankings, and the top five districts in the area have an A rating on Niche.

Navigating the Madison housing market

Madison has long been a seller’s market, but in this past year rising home values and recent seller behavior have made the market even more aggressive.

In 2020 sellers put off listing their homes due to the COVID-19 pandemic, creating a shortage for buyers. In fact, available inventory in Madison dropped from a 2.6-month supply to 1.6 months during 2020.

While the housing market is competitive in Madison year-round, it is especially active between March and September, when many people find themselves moving so their children can attend school in a top district. After school is out in June, Madison homes sell for 4.33% more than the yearly average. “The market values are driven primarily by the school district. So, you’re going to move after school is out and before school starts,” Chin says.

If you want to buy a house in Madison, February and March are the best months to make your purchase. In March, homes typically sell for 4.78% less than the yearly average.

Things to consider before buying in Madison

Older houses

At 44 years, the median age of Madison homes is similar to the median age of homes across the U.S. (43 years). If you want to buy a house in Madison that’s on the older side, keep in mind that it may require some extra maintenance and repairs. Regardless of whether you’re eyeing a historic home or newer construction, it’s vital that you get a home inspection to identify any potential issues before you buy.

Insurance considerations

Madison gets an average of 42 inches of snow a year, 14 inches higher than the U.S. average, creating picturesque winters full of activities like sledding and cross-country skiing. However, the snow — and hail in rainy months — can be tough on a home’s roof. “The roofs can take a little bit of a beating,” Hauk says. Fortunately, homeowner’s insurance policies typically cover repairs for weather-related roof damage.

With four lakes, some of Madison’s homes are located in FEMA floodplains and homeowners who live in those areas will need to purchase flood insurance. In Wisconsin, the average cost for this additional coverage is $973 per year. City zoning ordinances limit development in flood-prone areas, however, so few homes fall into the 100-year floodplain, FEMA says.

Elevated radon levels

South central Wisconsin, where Madison is located, is known for having higher-than-average levels of radon — a naturally occurring, radioactive gas — and one in 10 homes statewide has high levels of the gas. As a result, potential buyers are encouraged to get a radon test. These tests are typically inexpensive — kits can be purchased for as little as $10 — and they can be added onto a standard home inspection.

If testing shows high radon levels, there’s no reason to fret. An EPA-licensed inspector will typically provide a free remediation estimate and they often guarantee that radon levels will be acceptable if work is done on the house. The cost of radon mitigation is usually around $1,200. As is typical in most areas where radon is common, sellers usually will pick up the cost for radon mitigation if needed, and many will have tested the home before putting it on the market.

Find a top buyer’s agent in Madison

Working with a real estate agent during your home search is a must for navigating Madison’s housing market. Top buyer’s agents in Madison complete 1.8 times more transactions than an average agent and save buyers $46,386.

In this competitive landscape, buyers need to be aggressive if they want to buy a house in Madison. One way buyers can get an edge is by making an offer before a home is publicly listed. Chin says in the first quarter of 2021, 29 of the accepted offers for his firm were on homes that were not yet on the market.

“We’re writing sight-unseen offers to get an edge up on the competition.”

Chin says another way buyers can make sure their offer is competitive is by including an escalation clause, which allows a buyer to increase their offer up to a set amount if a seller receives another offer that is higher than the buyer’s initial offer.

Additionally, buyers can gain an advantage by writing a “seller love letter.” In these letters, a buyer details what they love about the home and they provide reasons why the seller should select them. In family-friendly Madison, seller love letters can appeal to empty-nesters, especially if the buyer details how they plan to grow their own family in the home.

“Most sellers want to hear that a buyer is going to love their home, to take good care of it,” Chin says. And who can blame them?

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