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When I think about hot housing markets, I think of that infamous Oprah meme. Only, instead of everyone getting a car, everyone gets offers. Is this still the case now with higher interest rates? You bet. According to NAR, “Buyer competition remains intense due to the short supply of homes on the market.” Multi-offer situations can be extremely stressful but there are tips and tricks you can use to tackle them head on. Here are a few ways to win in a multi-offer situation.
RESEARCH AND PREPARE
Research
To win in a multiple-offer situation, you want to understand the current real estate market. Is it a buyer’s market or a seller’s market? What do interest rates look like? Is there a lot of inventory? What does the competition situation?
Having a good understanding of what the market looks like will give you a better understanding of how to navigate it. For example, if interest rates are low, and there isn’t a lot of inventory, you can guess that most homes will have a lot of offers. Or, if it’s a buyer’s market, and the sellers have a lot of competition, even if there are multiple offers, a strong, confident offer with a few tweaks could be exactly what you need to win that situation. Understanding what is happening will allow you to adjust your strategy accordingly and give you an opportunity to cancel out your competition.
Preparation
In the words of Scar from The Lion King, “Be prepared!” Have your finances sorted out, your pre-qualification letter ready. Know what your maximum spending amount is and prepare your strategy for a counteroffer. Have a complete understanding of what you’ll be asking for and offering in your contract so that it can be submitted as soon as possible. Indicate if you will purchase with cash or a loan.
Typically, in multi-offer situations, sellers will be looking for which offer seems the best. This means that it’s common for them to weed out offers that come in too late, don’t offer any assurance that the buyer has finances secured, offers that seem wishy-washy, or like the buyers are demanding too much. The more prepared you are, the more likely you will be able to win in a multi-offer situation.
OFFER VALUE
Next, make your offer stand out. Show your value. How? Consider offering a good, solid amount. Multi-offer situations are not the time to try to low-ball or demand negotiations. Another option is to increase the due diligence or earnest money amount. Doing so can make a seller feel more secure should the home purchase fall through.
If you have any indication that the seller wants to sell and move quickly, be willing to move faster. If you know that the seller needs to stay in their home for a certain period longer, be flexible (when possible) regarding closing or your move in date. Tailoring your offer to the seller’s needs when possible and if it makes sense for you can make your offer stand out among the crowd.
The point is, you need to offer value to the seller and show what sets you apart from the competition. Consider what makes your offer unique and how it will differ from the others the seller receives. This difference could be the exact thing that helps your offer win in a multi-offer situation.
BE ADAPTIVE & QUICK
Being unwilling to budge on your offer will not help you win a multi-offer situation. You need to be adaptive. You need to be willing to negotiate. In a multi-offer situation, the seller is the one with the leverage. Be open to finding common ground. If the seller counters your offer, truly consider it. If you don’t, they will move to the next offer, and your loss will be someone else’s gain.
Being adaptive also means you have back up plans and aren’t afraid to use them. Have alternative options for what you offer and ask for. Being flexible is important for anyone trying to get their offer accepted over multiple others.
Timing is Key
Timing truly is key in multi-offer situations. I have not met many sellers who aren’t prioritizing a quick home sale. If a seller receives a competitive, quality, valuable offer soon after listing their home, it is likely they will highly consider it.
Furthermore, multi-offer situations often go hand-in-hand with homes going under contract within hours. If you are not fast-acting, there’s a chance you won’t even have an opportunity to be one of the multi-offers, let alone the winning one.
If a seller does give you a counteroffer, being prompt in your response or additional offer is important. It shows the seller you are serious and are not playing games. If you take a long time to respond or counter, the seller could think you aren’t motivated, and may find another buyer who is.
SEEK PROFESSIONAL HELP
Obviously, this seems like a shameless plug, since I offer the professional help buyers need in a multi-offer situation. However, making an offer on a home is a complex thing in and of itself. Making your offer stand out among the crowd is even trickier. Real estate agents are professionals who are experienced in navigating multi-offer situations. Your best bet is to partner with someone who has the knowledge and familiarity with these situations so that you can come out on top.
Remember, winning in a multi-offer situation is not about getting your way no matter what. It is about finding mutually beneficial solutions for both the buyer and the seller. Preparing, offering value, being adaptive and quick are all ways to win a multi-offer situation. If you would like more advice or want to partner with a real estate professional, please contact me here. I would love to work with you!
