If you are a buyer, it may feel like every house for sale is holding offers and selling in multiple offer situations. In reality, this is only true for about 15% of homes on the makert this spring, but these 15% are the homes that ALL buyers want. The sellers know they have a hot product, they don’t have any competition, and so they are looking to get the best price. I’ll talk about the other 85% of homes out there in a minute, but first, if you really must have a home that is going to go into multiple offers, I want to offer you some tips that will greatly increase your chances of winning the home.
- Certified Check. If you know that a home will not be accepting offers for 3 days and you know you want to offer on it, you have the time to draw a certifed check from the bank, to show how serious you are. Most people don’t realize how much goes wrong after the contract is singed, and having a certified cheque is like dumping a bag of cash on the table. it shows you are dead serious, and this goes a long way to make the seller confident that you, as a buyer, will not scuttle the deal in any way after the fact. The $30 it costs to get a bank draft might be the difference in getting your dream home.
- Up Your Deposit. Along these lines, a small deposit also suggests you don’t really have the money to afford the home; $5,000 of $500,000 is not a good sign. Will your bank decline your financing? Are you really serious? Calm the seller’s nerves by giving the best deposit you can. Money Talks. Show you are Serious. Especially if your offer is very close to another offer, it’s these differences that will tip the balance in your favour. It’s not just about how much your offer price is.
- Sell Your Home First. In a strong sellers market, this also means that you have power when you sell your home. Negotiate a flexible or longer closings date, and I guarantee to you that multiple houses will come up for sale within a 2 month period that fit your criteria. So many people tell me they are afriad that nothing good will come up for sale if they sell first, but this is never true. With the confidence of having a firm sale on your home, you can go into offers with all guns blazing, knowing exactly how much you are willing to offer. And again, if the seller knows your house is already sold, your position to them becomes much stronger; they know you are serious, and it’s very likely that the deal will go through.
So if you’ve noticed a common thread in these 3 points its this: make the seller 100% confident that your offer is solid as a rock. Just recently I sold a home in multiple offers, and there were 2 offers the same, and one strangely higher – above what we knew was fair market value for the home. Tempting? Yes! But they had promise of a tiny deposit, didn’t have a home (no equity) and had a few odd conditions. Did my clients take that offer because it was the highest? Absolutely not. Never think it’s just about the offer price, and a good agent knows this. Sellers don’t want the deal to fall apart, so in the end, they took the offer that looked solid from all points. With the buyers they chose, they were confident that once they signed the papers, the deal was done.
On a side note, let’s go back to the 85% of homes that DON’T sell in multiple offers, even in today’s market. As a buyer it pays to have vision. There are many many well loved, well taken care of homes that need cosmetic updating. If you are not comfortable paying top market value for a home, your other option is to buy a home that is not in multiple offers, where you can negotiate the best price, and build your own equity. Every home owner should be saving 5% towards home maintenance, though many, especially those who have maxed their mortgage, do not. If you can buy a home that allows you to build these savings, you can then pick a project every 6 months to a year to better your home and build your own equity. When it comes time to sell this home you bought for fair value and upgraded it, look who’s got a product in high demand now? You do!
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