Tis’ the season for…
Bidding Wars!
No matter what inventory looks like in the beginning of the new year and into the Spring, we all know that we are entering a sellers’ market. There will be more buyers than homes listed which in turn creates multiple offer situations, or bidding wars.
In this ultra-competitive market, you want to arm yourself with all the tactics needed to set you buyer(s) apart from the rest in order to be in the running when a multiple offer situation arises. Better yet, being the agent who gets their clients offer accepted. Following these strategies can help significantly raise these chances:
Pre-approval
If able, its in your best interest to use a preferred lender. Not only will you know they are reputable, but they can also go to bat for you if an issue arises or even just to assure the listing agent that financing is covered. Making sure your buyer has an up to date pre-approval, preferably with the property they are putting an offer in on is important.
Build Rapport
Sounds simple, right? Well, it is, but there are many ways to do this:
- Make friends with the listing agent. Compliment them on the listing and on the house itself. Agents prefer to work with people they like. Wouldn’t you if it was your listing?
- Texting the listing agent after a showing or open house. This helps to open the lines of communication and make a connection.
- If possible, attend the open house with your buyer(s). This will give you a chance to meet the agent in person and compliment their new listing.
- Talk up the buyer’s lender especially if you’re using a preferred lender. Assure the listing agent that they can call or email the mortgage broker if they have any questions or concerns about financing.
- Keep you phone handy. You should always be readily available if the listing agent reaches out to you for any reason.
Have your buyer(s) readily available to see homes
This benefits the buyer by getting in prior to the open house and benefits the agent giving them more free time for other clients on the weekends. Ask your buyers “Is there a day you get our of work early or go into work late?” Because this will allow us to see homes before other buyers and give you a competitive advantage.
Offer Over-Asking
As we know sellers price their homes aggressively so it would be in your buyer’s best interest to look at homes slightly below their budget in anticipation of needing to offer more than asking price. In addition, you can add an escalation clause to help raise your chances of beating other offers. This will allow your buyer to offer a certain amount over the seller’s highest offer and up to a pre-determined price.
Personal Letter
Having your buyer(s) write a heartfelt letter to the seller to accompany their offer letting them know more about them, how much they love their home and have done a great job maintaining it can help a great deal. It’s that added personal touch that goes a long way.
Consider Waiving Inspection
Waive a contingency, such as the home inspection, if your buyers are in a position to do so and are comfortable with doing so.
Shorten Time Frames
If possible, shortening time frames for the inspection, P&S date and mortgage contingency can help in sweetening an offer. Make sure to check in with your lender to determine the earliest mortgage contingency date.
Increase Down Payment
Sellers sometimes look at a buyer as more qualified if they have a larger down payment. So, if your buyer is able to put more money down, as well as, a larger deposit this will make your buyers more “attractive”.
Flexible Closing Date
Be as accommodating as you can be. Sometimes sellers have a certain time frame to close within, be it quick or longer than the average transaction time frame. It can have a big impact on the sellers if your buyers are flexible with the closing date.
Use & Occupancy Agreement
Explaining to your buyer(s) that considering a “rent back” option to the sellers can be appealing if they need to stay in the home for a brief period of time after closing until they move into their new home.
Staying ahead of the game by keeping up with the market, and preparing your buyer(s) for what is needed to submit an offer, along with using some, or all, of these strategies can help increase your buyer’s chances of being in the running during a multiple offer situation – or better yet getting their offer accepted!