The real estate market is competitive right now, lack of inventory over the last several years has created a challenging environment for buyers who are often up against multiple buyers all bidding for the same property.
For buyers who are just entering the market or for those who have lost out on one or several properties, here are a few tips for putting your best foot forward and successfully navigating a multiple-offer situation.
Work with a Professional and Know the Market
Working with a real estate professional who is experienced and who is an expert in the market can be a crucial factor in determining whether you will be on the winning or losing end of a multiple offer situation. Are homes selling over asking price? Is seller’s underpricing to encourage multiple offers? What are similar properties selling for? An experienced agent, who you trust, can help to determine appropriate value based on the current market trends and can assist in negotiations and advice throughout the process
Come in Strong Upfront
If you know, or suspect, that you’re entering a multiple-offer situation, you’ll want to come in strong from the very beginning. Some buyers try to come in low initially as a negotiation strategy; however, if the property is priced well and is expecting multiple bidders, you may not want to risk having the seller disregard your offer immediately for not being a serious contender. One of the most important factors when a seller is considering multiple offers is their belief that the chosen buyer is serious about buying the property, and that they could meet the terms and close the sale. One of the best ways to do this is to come in strong right from the start.
Come in Clean and With as Few Contingencies as Possible.
Make your offer as clean as possible and package everything to be submitted together in a coherent way. You don’t want the seller or their agent to have to chase you for paperwork, signatures or proof of funds. If you need financing, are you able to put more money down? Consult with your agent about what works for you so that you can come in with your strongest possible offer.
Get in Backup Position.
You’ve done everything you can. You came up to your highest price and your best terms and you still don’t get an accepted offer. If you’re one of the top contenders, the seller may offer you a backup position. As first backup, you are first in line to get the property at your final offer terms if the first buyer falls out of escrow or does not perform. If you still want the home, backup position can be a great option.
It can be incredibly frustrating to buy a home in a competitive marketplace. Sometimes it takes a few times around to fully understand the process and what is necessary to win in a multiple-offer situation. Working with a professional who you trust can help the process feel less daunting. Give yourself a break if things get too overwhelming. It can be emotionally draining to lose out on a home you had your heart set on. Give yourself time to reset before taking the plunge again. Stay positive, focus on the big picture, and keep your end goals in mind.