Here are my five tips for buyers in a multiple-offer situation.
The question I get asked more than any other is, “How’s the real estate market?” Right now, we’re in a pretty strong seller’s market. I would say the strongest I’ve ever seen in the central New York area. If you’re a seller and you’ve got a place to go, it’s a great time to be selling. For buyers, this presents some challenges and obstacles. Here are some tips on multiple offers so that yours can outshine the rest and win the day:
1. Make a larger earnest money deposit. Your earnest money deposit will definitely send a message to the seller that you’re very serious and it’s part of the purchase price. You’re just giving more money upfront that’ll be held in escrow until the closing, but a stronger earnest money deposit might quell some of the seller’s fears that their transaction could fall through and they might be left with no buyers.
2. Show the sellers that you’re qualified. This is extremely important if you’re buying with cash. You’ll need to have proof of funds available to show to the seller, the listing agent, and possibly even the seller’s attorney if you’re getting financing. You’ll need a strong letter of pre-approval, not just a pre-qualification letter.
3. Give the sellers flexibility when moving. Sometimes sellers need a little bit of extra time to find a house. They might ask for a delayed closing of over a month or two. If you show them flexibility and your willingness to allow them to get a little bit more comfortable with this whole transaction, that could give you an edge. It could even be something as simple as giving them an extra two or three days after the closing to move out.
4. Shorten contingency time frames. It’s typical in central New York for a 10- to 12-day period or for a home inspection. Shortening the time frame on this lets the seller know that even though you’re going to be doing an inspection, it’s going to get done quickly, so we all know what direction we’re headed in with this transaction. Many buyers are also waiving home inspections and waiving other contingencies to make their offer cleaner. I don’t recommend waiving a home inspection for a purchase this large.
5. Write your best offer upfront. There may not be a chance for negotiation. Oftentimes, the seller picks the offer that they like the best. Whether you’re using an escalation clause to demonstrate what your top price would be in a multiple offer situation, or if you’re just writing an offer, make sure that you’re offering your highest and best price. Ask your agent that’s representing you for a comparative market analysis to determine pricing.
If you have any questions or need any advice, you can always get in touch with me at 315-254-6973. I look forward to speaking with you. Have a great day.