How to Deal with Multiple Offers as a Buyer
For the time being, Denver is in an extreme seller’s market with only 30 days of inventory on the market and an average days on market of 18. As a result, most buyers are up against other buyers bidding on the same home.
Ask the Seller What They Want in an Offer
Seems basic huh. Money is always a big factor, however, some need to stay in the house while they shop for a new home so a rent back to the seller post closing can make your deal stand out. Of course you need to be able to stay where you longer. What terms work best for the seller? Do they fear the inspection? You can get your inspection done in the first five days if that helps you win.
Reduce your Contingencies
Remove the contingencies you do not need in an offer. Maybe you can skip the survey, or inspection objection or even the appraisal condition because you are paying cash and are comfortable with the value.
Offer Cash Over Appraised Value
Lets assume you are writing an offer for a home in an area that has drastically changed in the last year. Prices have jumped. Flippers are very busy in the area and everyone is talking about it. In this situation, demand can out pace (price) the appraised value. If you are buying the nicest home and a new flip on a block, the seller has concerns that the offers coming in will not appraise for the contract price. If you can see the potential for this gap ahead of time, write your offer to give the seller a defined amount over appraised value if the the appraisal is lower than the contract price. That will help you manage your risk and let the seller know you can bring ___ to the table if the appraisal is low.
Send a Love Letter and a Personal YouTube video
Assuming the home is priced correctly and close to the appraised value, the home is likely to see offers that will exceed list price and maybe the appraised price. Buyers are well trained and practiced these days so offers often come in very close to each other. The seller may be looking at a small difference between price and terms. At this point you need to stand out as real people that look forward to making the house a home. Your emotional connection may trump other offers that are higher.
In a letter, briefly introduce who you are, why you love the home and love the area. This isn’t the place for boasting, just connect as real people. In addition, spend 5 minutes and a few takes making a simple smart phone video you can load to youtube. Let the seller see your bright-eyed enthusiasm for the home . You would be surprised how much this can sway a seller with multiple offers.
Side Note: Keeping your videos private
Manage your Expectations
Put yourself in a position to negotiate. If you have a lease expiring and you cannot stay month to month, you may have to compromise the quality of the home or the price you pay. Know the average days on market. Have a feel for how many offers it takes in your price point.
Hire a Professional with Recent Buying Experience
Getting a home under contract as a buyer or as a buyer’s agent is hard work in a seller’s market. Interview your agent before you hire them. Its not an easy task these days and your agent needs to be committed to your success.