I’ve been looking for a house for six months. I’ve submitted three offers in multiple offer situations, and I’ve lost each time. I finally found THE HOUSE. I want to submit an offer but I’ll likely end up in another competitive offer situation. What can I do to make my offer stand out and be the one selected by the sellers? – Hopeful Homeowner
Dear Hopeful Homeowner,
Your scenario is all too familiar and one to which many buyers in this market can relate. That being said, there are things you can do to differentiate your offer and entice the sellers to choose your offer over the others submitted.
First, have your Realtor call the listing agent to gather as much information as possible about the seller’s situation. How soon do they want/need to close? Have they already found their next home? Do they need time to find their next home? Are they contingent on selling their current house? Assuming you have flexibility for closing, structuring an offer with a closing date that coincides well with the seller’s needs will definitely make your offer more attractive to the seller. Most contingent sellers would prefer to move once, and it may be worth it to them to take a little less on their price if they can move once; in those instances, the winning offer isn’t always the highest offer.
Second, when your Realtor calls the listing agent, he or she should also ask about the showing activity on the house and whether or not other buyers have expressed interest or submitted offers. This information is valuable for developing an offer strategy. If the house is newly listed and has received a high number of showings and/or verbally expressed buyer interest, then chances are this property will sell quickly and for close to – if not over – asking price. It’s likely that you’ll have one shot at submitting an offer and not a lot of leverage for negotiation, so make sure to submit the best offer you can.
Third, ask your lender to call the listing agent on your behalf. When presented with multiple offers, the listing agent must help the seller differentiate between and select the best offer, and one approach they’ll take is to verify all the buyers’ financial qualifications. When a lender takes the initiative to call the listing agent – as opposed to waiting for that agent to call – they’re accomplishing two things. First, they’re affirming your financial ability to purchase the property. Second, they’re sending a message to the listing agent about their proactive attitude and setting the tone for their work ethic throughout the transaction. In a multiple offer situation where the price and terms are all strong and similar, a proactive professional lender could actually be the deciding factor.
Lastly, remain calm and rational. It’s definitely hard to do in your situation, but it’s important. Decide ahead of time what your limits are as far as price, terms and timeframe, and stick to them. Don’t be afraid to walk away if the negotiations take you beyond your comfort zone; the multiple offer situations can get emotional and the stakes can get high, so make sure you’re paying attention to your limits. It may not feel like it to you right now, but there will be other properties out there and you won’t have to give away all of your negotiating power to get them.
Good luck, Hopeful Homeowner, I hope this one is the winner!
Renee Cohen is a Colorado Realtor with a passion for helping her clients find their dream homes in the challenging Denver market. She loves educating her clients about the market, advocating on their behalf, and helping them make informed decisions. Reputable. Reliable. Remarkable. Real Estate. Contact Renee to assist you with your real estate needs!