How to win in a multiple offer situation
Pro Tips - Multiple Offers
When the Vancouver real estate market is HOT, we often see homes sell in a very short time period and for far above list price. Yes, it’s the season of the Multiple Offer where the highest and cleanest offer will typcially win. It’s not such a bad thing being a seller in this market but being on the buying side can be down right frustrating. Losing on a multiple offer often feels like being sent back to the start gates with a little less money in your pocket each time.
As a prospective buyer there are a few tips we’ve found that have worked very well for our clients. Typically cash is king but in a close race any one of these tips can be the difference between more open houses and planning your move.
Time IS of the Essence!
If you see a property that you are interested in, don’t wait! Get your Agent on it right away! Hot properties can often be sold in two or three days and sometimes on the same day so a hurry up attitude is the only way to be in the race.
To show the sellers that you are serious, arrange for a property inspection to ensure that there aren’t any surprises. Once satisfied with the inspection report, you’ll need to give details of the specific property to your mortgage broker or lending institution, so that they can arrange for an appraiser to verify the homes value.
The goal here is to provide an offer as clean as possible. This means as few subjects as possible and in order to do this – you, your Agent, and lending institution must move quickly.
In a balanced market you would may have financing, inspection and bank appraisal as subjects that are to be removed within a specific time period but in the competitive sellers market, having subjects like this on an offer can be the kiss of death.
How Serious are You?
By doing everything listed above it shows that you are a serious buyer. Getting your pre-approval in place, a property inspection completed, as well as having a Bank Draft in Hand will give the seller much more confidence in your offer and ability and intent to follow though on the purchase.
If purchasing a condominium, ta well organized selling agent will have all the necessary documents a buyer would require in order to complete their due diligence. Reviewing the Strata Plan, Strata By-Laws, Minutes, AGMs, SGM’s (if any), Form B, Depreciation Reports(if any), Engineers Report (if any) are all important documents that will help you understand how well the building (strata) is run and how well it is maintained. It is vital for you to be aware of any large expenditures or assessments that are on the horizon so you can properly plan for any possible upcoming changes to your strata fees or required one-time assessment.
Give it Your Best Shot!
Once you are sure about your decision and are ready to make an offer, go in with an offer that is the strongest you can comfortably afford. In a multiple offer scenario you will likely only get one chance of making the most impact so make sure you put your best effort forward. How would you feel if you lost out by $1000? We’ve seen it happen!
Have your Agent do a little investigative work on your behalf. Gett as much information on the sellers as possible. Are they getting ready to buy their next house? Have they already bought their next home and need a quick sale? What is their motivation for selling? Do they have kids? If so, what school do they go to? Find a connection or a common ground with the sellers and you will see your offer stand out among the others.
Tailoring your offer to the sellers needs may be the one thing that puts your offer on the top of the pile and give you a leg up over another. Flexible on closing dates? Communicate with the selling agent and have the sellers choose dates that work best for them.
Emotions May Be Worth More than Money!
There are additional things you can do to sweeten the deal. Appeal to the seller’s emotional side. Write a short letter to tell them why you love their house and how you see your family enjoying it. Talk about your kids and how they have already picked their respective rooms and that you appreciate their time in looking at your offer. Finally, wish them luck on their next chapter in their life. Sounds cheesy? It sure does, but it works.
Sellers are emotionally attached to their homes. often times they have spent a better portion of their lives in their home and having a buyer recognize and respect this can pay dividends. Remember, a successful offer doesn’t always start and end with price. Often times we have seen sellers accept a lower offer because of the relationship or connection they have with a potential buyer. Sellers want top dollar but all things being equal they also want a buyer that they feel will be a good fit for their home. When your agent presents your offer, have them sell your story and reaffirm that emotional connection you have with their home.
Show Them The Money!
Want to really seal the deal? Get the bank draft and have your realtor present it with the offer. Seeing numbers on a contract is one thing, but being able to touch and feel a draft is a tactile experience and shows the seller that your offer is serious, ready and organized. Don’t worry, the seller doesn't keep the bank draft - you are just showing to them that upon acceptance of your offer there will be no delays.
Sellers want a streamlined process when selling their home so the easier you make it for them the better chances you will have in coming up victorious in a multiple offer situation. These tips are just a few to help you get that dream home of yours and into the Vancouver property market.
Please feel free to contact us when you are ready to buy.