Multiple Offers
Over the past 10 days, 4 different buyer clients of mine decided they found the right house for them. So they each wanted to make an offer.
Out of the 4, 3 of the homes received multiple offers on the same property. Astonishingly, all 3 offers ended up being accepted by the sellers, which got me thinking about how buyers should approach the multiple offer scenario.
First off, if you have a good Buyer’s Agent, they should be asking the Listing Agent if there are any offers on the property before you actually take the time to write up an offer. If there are 3 or 4 offers already in, you may want to move onto the next house. This is something I always try to do unless we are writing up an offer quickly on the weekend and can’t get a hold of the Listing Agent.
Secondly, ask yourself a couple questions: is this the best home for us given the circumstances of our lives, and how much would we be willing to pay for the home?
Since your first real estate purchase is probably going to be owner-occupied, you want to make sure this is a place you actually want to live in for a handful of years at least. If you’re just in it because you think it’s a good investment, maybe you should wait on buying. After you decide you want to live there, ask yourself exactly how much of your hard-earned dough you’d be willing to spend in order to have the place for yourself.
When you’re dealing with Multiple Offers on a home, you’ll most likely hear the term “Highest and Best” Offer. This doesn’t mean it brings you to your spending limit, but rather bidding the most amount of money you would want to pay for the house.
If you really want the house, make sure to come at the seller with a good offer.
What makes an offer good in the seller’s eyes??
- Highest Purchase Price
- Lowest Paid Contributions to Buyer
- Least Amount of Contingencies
- Highest Earnest Money Amount
- Fastest Closing Date (especially if they are a bank)
- Strong Pre-Approval Letter
The seller is looking to get the highest dollar amount for their property, but also wants to make sure that the sale actually Closes. So sometimes they will take a lower offer if the other terms are more attractive.
2 of my 3 buyers made offers above list price, and the 3rd made an offer just $2,000 below list price.
Hopefully that shows you if you really want the house, don’t come at the seller with a total low-ball offer. Someone else could outbid you and the house could be gone.
Remember this is real life, and these properties aren’t just sitting there for your taking alone. You’ve got competition, and if you wanna play to win, you better bring your A-Game.
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