5 Strategies That Will Help You Win Out in a Multiple-Offer Situation
Certain segments of the Portland market are still highly competitive for buyers, which makes multiple-offer scenarios a reality they have to deal with. When crafting your next offer, here are five of the most effective strategies you can use to win out, if you find yourself in a multiple-offer situation:
- Shorten the length of the inspection period. The typical inspection period is ten business days (or two full weeks), so shortening your inspection period to, say, five or seven business days will prove to sellers that you’re willing to move quickly with the transaction. It also ensures that in the event that the transaction falls through, their home won’t have been off the market for very long.
- Offer a free rent-back. One of the most challenging aspects of selling a home in today’s market is figuring out where you will move to next. Offering a seller possession of their home after closing, gives them additional time to shop for their next home — with the funds from the sale available for them to use. This rent-back period usually only lasts up to a maximum of 60-days.
- Offer to purchase the home as-is. By guaranteeing that you won’t ask for any repairs in your purchase agreement, you remove an enormous amount of stress for the seller. You will still complete a home inspection, and if you find any issues that make it too costly for you to move forward with the transaction, you still retain the right to back out and receive your earnest money deposit back. If this were the case, we could always ask the seller to lower the purchase price or contribute towards your closing costs in lieu of completing the repair(s), so we could keep the deal together.
- Offer to waive the appraisal contingency. If a home doesn’t appraise for the agreed-upon purchase price, you typically have to renegotiate the contract. If you offer a predetermined amount in cash that is above the home’s appraised value (in the event that it comes in low), you make your offer more comparable to an all-cash offer, which does not require an appraisal. One thing to keep in mind, is even if you pay slightly above market value for the home today, that could just mean you’re paying the future market value of the home, say, six months from now. And if you keep getting beat in multiple offer scenarios, that could be the price you end up paying anyway, simply by taking another 6-months to find a home.
- Figure out the right price. Price will always be one of the key factors in determining who wins in a multiple-offer situation, but it’s not always easy to know what price to offer. I help my clients figure out the right price to offer by looking at sales of comparable properties over the past 6 months, placing a particular emphasis on the homes that have sold in the last 3 months. I then make direct home-to-home comparisons between those homes and the home you are planning to submit an offer on, to give us a good sense for the value in that neighborhood. This data gives us insight into what the home could — and should — trade for, given the current market demand. It is then up to you to decide whether you’re willing to offer that price.
If you’d like to talk more about how you can craft the best offer possible or you have any other real estate questions I can answer, please don’t hesitate to reach out to me. I’d love to help you.