Jim Valentine: The discomfort of multiple offers
Some properties and markets tend to generate multiple offers. Just the name sounds exciting and most sellers think they would want that situation. Unfortunately, they aren’t as much fun as one might anticipate. With the emotions already running high in residential real estate, having the uncertainty and anxiety of competition can be most uncomfortable to buyers, agents and even sellers and their agents.
If multiple offers are received and presented all at the same time, the scenario isn’t so hard. The seller can select one, counter one or counter multiple offers even on different terms. It is important that the listing agent be fair to all during the presentation and the handling of the offers. Candor is often the best way to go. With the seller’s permission, the agent can share offers with other agents, but that isn’t always in the best interest of the seller despite the fact that it appears it would be. Someone might offer less than they would have if they know the competitive offer is lower than they might have otherwise guessed.
When offers are strung out, things can get dicey. For instance, an offer is received that needs to be countered. The seller takes time to ponder a counter and, a couple of days later, has his agent write a counter offer. Before that counter can be sent to the buyer’s agent, another offer comes in at full price. During this time, there is another showing that results in that prospective buyer wanting to write a full price offer. When that agent calls and is told there is a full price offer being accepted, he is not happy about wasting his time showing.
Understand, however, that when he was showing the counter was just being put together and there was no way of knowing if it would be accepted. Then the other offer resulting from a showing the day before pops in. It is all in the timing. Everyone needs to be treated with the same courtesy, but some were compromised simply by the timing of things. No fault of anybody. Sellers aren’t required to respond to an offer and sometimes they don’t if they aren’t compelled for one reason or another. They usually want to have an idea that they will be able to have a meeting of the minds with the other party before acting.
Multiple offer considerations don’t always involve price. Sometimes the strength of the offer takes precedence, i.e. cash offer vs. a zero down loan. Oftentimes, sellers like one party or another for assorted reasons. One buyer might have children to raise in the house where the seller raised their children or they are both car people and the garage/shop will continue to be put to good use. Time can be an issue. We prevailed one time in a multiple offer situation because we offered a six-month escrow, which suited the seller perfectly. Other times, shorter escrows are more attractive.
To stand out with a multiple offer, work to make your offer the best suited for the seller’s wants and needs from the get-go. If you don’t know, have your agent call the listing agent for some information that might help you get an edge over the competition. Even if you can’t go up in price, you might be able to sweeten the offer in other ways. One time we prevailed by agreeing to name the subdivision after the sellers.
Our advice: Everyone gets nervous with multiple-offer situations. Buyers want to buy, sellers don’t want to make a mistake and agents are trying to appease their client. The right result will happen, but those who don’t prevail are understandably not happy when their offer isn’t the one accepted. In this market, that can happen with regularity. Talked to a buyer recently who had missed out on 32 homes. He was in a different market, but he was working hard to buy. That’s what it takes. Keep throwing mud on the wall, something will stick.
If others like the home you are offering on you have selected well. Do your best to get it. Sometimes your cash won’t get you a “steal” but it will give you the edge to get you the house you want.
When it comes to choosing professionals to assist you with your real estate needs… Experience is Priceless! Jim Valentine, RE/MAX Realty Affiliates, 775-781-3704. email@example.com