How Much Earnest Money is Required when Buying Property?
Earnest Money is the initial deposit that a buyer will submit when writing an offer on a property that is listed for sale. While there is no real "standard" amount of earnest money required, the amount submitted with an offer can have a strong affect on the offer's strength. In Park City Utah, it is typical to see the earnest money at about 1-2% of the purchase price for the property. We do however see buyers offer less, and we also see some buyers offer more. Typically a cash buyer will offer a higher amount of earnest money to show their strength and ability to purchase, while buyers planning to obtain a mortgage will offer a little less. There is no real right or wrong, or standard amount,
INFO THAT HITS US WHERE WE LIVE...The housing recovery may be proceeding slowly, but things are definitely not at a standstill. Earlier this year, an industry rent vs. buy index found it is more affordable to buy than rent a two-bedroom home in 72% of America's 50 biggest cities. In fact, renting was less expensive than buying only in New York, Kansas City, San Francisco and Seattle. And in 10 of the cities where renting was relatively affordable versus ownership, people felt buying may still be a financially sound long-term decision.
A recent consumer study showed people are getting the message. With home prices now at such affordable levels, 62% of those surveyed said buying in today's market is a good investment over the next 10 years. The most popular