To win more bidding wars, you need a few tricks up your sleeve. Here are those tricks…
When in a seller's market with a lack of inventory getting buyers offers accepted can be dicey at times. In this kind of market, it's important for you to go the extra mile. Follow these five tips and I promise this will be the difference between winning or losing in a bidding war.
You need to do this every single time you submit an offer. Call the listing agent to find out if there are any competing offers. If you aren't at least finding this out then smack yourself because that's just stupid. Ask the needs and wants of the seller to find out what is motivating the seller to move. You want to find out how you can accommodate them. I was helping clients and found out the house they wanted to make an offer on the seller needed to sell their house first to be in a position to make an offer on another house. The seller did not want a quick close because this would leave them homeless. In this instance, you have tons of options to accommodate the seller with your offer. My clients offered to allow the seller to stay in the house an extra 30 days free of charge. This did not cost the buyer anything and was a win-win for everyone. The listing agent told me I was the only one who asked what was important to the seller. Guys, we were not even the highest offer. We won because of the terms. Remember your offer should always revolve around the seller!
Nobody likes a messy contract. This can turn off sellers and the selling agent immediately. Double check your contract for mistakes before submitting to the seller. Confirm you have filled it out perfectly all initials, addendums, and assure its free of spelling errors. When the listing agent receives your offer along with the twelve others you want to assure they know they are dealing with a pro who is competent at getting the deal closed on time and it's not amateur hour.
The price the house comps for is most likely not going to get the house under contract. This also means the house could potentially not appraise. You need to educate your buyers about the options if the house does not appraise. In a seller's market, you need to assure your approach is more aggressive. Throw a bunch of money at the house and write a contract with great terms. Have a plan in place already if it does not appraise. Now, I know if you are in a buyers market this might sound weird telling my clients to throw top dollar at a house. Your buyer hired you to get the house not sit around and look at comps while losing houses. This is when you need to set the expectation early and educate your buyers upfront so they are prepared when you get to this point.
Real estate transactions are more often than not driven by emotion. People are leaving a home where they created memories. Writing a letter to the seller about why the buyer wants to buy the house can sometimes help them envision who they are selling their house too. I've seen this work and not work. I think the key is to be genuine and authentic. Don't make it over the top and full of shit feeding lines you think they want to here. Instead, approach it as a way to flatter the seller and the house and why the house would be the perfect fit for you.
Standard earnest money in most markets is one percent. To stand out you need to show you have more skin in the game. Be willing to put more on the line. Consider offering more money than the typical one percent. If you have three offers on a 400k house and all offers have three-week closings and one percent earnest money than you bet you are going to stand out if you write a check for ten thousand dollars while everyone else has written a four thousand dollar earnest deposit check. Now make sure you educate buyers so they understand this becomes part of the down payment. Remember to watch your exit deadlines like a hawk. One other easy strategy is to have your lender making a call to the listing agent sets you apart immediately. Reason being, when you submit a pre-approval they are pretty generic and don't say much. A lender calling and vouching for the buyer assures they know your clients are very qualified.
I understand it's stressful working in a seller's market especially with buyers who don't have a lot of money. The feds just raised interest rates last week and they are expected to go up two more times by the end of the year. Will it slow down the market, maybe? It will take a few buyers out of the market but people are still going to need housing. If you learn how to get your offer accepted you will be an absolute pro when it flips to a buyers market. You will be able to get everything because you know what to do. Try these tips next time you submit an offer for your buyers and I promise you will stick out from the other offers on the table.
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