In many of the markets across the country and certainly here in Minnesota multiple offers are far too commonplace for buyers. They can become quite frustrating and be discouraging, especially if you happen to be one of those buyers that has lost out on several homes. I have heard of as many as ten (not any of our clients) offers without getting one accepted.
So, then how is it that we have three buyers in one month get into multiple offers and we get the home each time. The first time. Those are more than just lucky odds and I can assure you that we were not the highest bid on at least one of them and still got the home for our client.
So you may ask, how do you do that?
In multiple offer situations how do you and your clients beat the odds by such significant numbers? I think it starts by understanding the situation we are in and it can be hard to accept. We all want to feel like we got a good deal and the negotiating back and forth can be both nerve-racking and fun. There is just something about the idea of being able to get a seller down from their asking price. Maybe it just makes us feel better about that big purchase we are making. The first thing to get your arms around is that you have one shot to put your best foot forward, the seller is typically going to look at all offers side by side and choose the one they feel is best for them and their situation.
Price is usually a significant factor yet not the only one.
We start by trying to extract as much information about what the seller is looking for, closing date, any personal property they want to sell or leave, are there any emotional connections we can put together, such as kids, where they grew up, attraction to the area etc. Next we are going to look at other factors like amount of time allowed for us to do our home inspection, just by shortening that timeline up by a couple of days can be a difference maker. Are you pre-approved with a reputable lender? The real estate industry can be very small and tight knit, having someone with a great reputation handling your financing will go a long way with the seller’s confidence in your offer. Communicate to the seller that we are only looking for major issues on the home inspection, one of their biggest fears is they are going to choose you as a buyer and then you are going to give them a “laundry” lists of items that you want done. Most of them being general wear and tear issues of a used home, like caulking around doors and windows, etc. Obviously if there are issues that affect the value or use of the home they need to be addressed but far too often the buyer uses the inspection as a second chance at negotiating, which in my opinion is not in good faith.
Let’s talk about offer price. This is a tricky one and the best advice I have for you is to realize that you have one chance to lay your best foot forward and somewhere inside your head you have a number. It doesn’t have to make sense. It has to be a number that if you don’t get the house, you are okay because there was no way you would go higher. On the flip side if you would kick yourself because you would have gone a little higher but your pride is getting in the way, take a deep breath and pick your number you are okay with and move forward, don’t look back.