A couple weeks ago I showed a home in NE Minneapolis whose owners had spent months preparing for the sale. The photos were from last summer. That means that they meticulously planned every corner and cranny since then. There was a constant stream of buyers. That evening I received an email from the listing agent, “Thank you for your patience while we comb through 28 offers.”
The next weekend I showed a similar smaller home, and the 27 who weren’t the winner last week showed up on a Saturday morning to try again. There were 14 offers on that home. Last week I put 2 homes on the market, we had a flood of showings even before I could upload photos. In working with sellers to choose between multiple offers, there are some things that buyers should know about why one offer is accepted over another. The decision isn’t made on price alone.
- Do include a letter to the seller about why you want to buy their home. If a seller has put a lot of work into their home they appreciate a buyer who notices, and says something personal that makes the seller want to pass the torch. It does make a difference.
- Attach a pre-approval letter from your lender including the address of the home. Have your lender call the listing agent to verify that you are a solid buyer that they have checked your employment, and they don’t anticipate any difficulty closing. Knowing that the lender took time to call gives the listing agent assurance that both the lender and the buyer will perform.
- Include earnest money that is at least 1% of the purchase price, or more to show that you’re a serious buyer, you can afford the home, and you are intent on closing.
- Make your first offer your best offer. Although you might think that a seller will counter your offer, or call for a highest and best, they don’t have to. Sellers are not required to announce a highest and best offer timeline, or even advise that there are other offers.
- Make sure that you include all the right documents when you submit your offer. If it is townhome or condo, short sale, or foreclosure there are extra documents required. Missing documents or a sloppily written contract could cost you a winning offer.
- Personal property, like the lovely painting over the fireplace that you adore, is not part of the sale. Appliances, unless they are built in, are not included in an appraisal, nor part of the sale. FHA loans, and VA loans don’t want any mention of personal property in your offer. Negotiate those separately. It could be that the seller is willing to part with some things, but I’ve found that what a buyer thinks should be cheap, or free, is not usually what the seller has in mind. You don’t want the sale to get hung up over a table, or curtains.
- Avoid writing in a deadline. One time an agent wrote that the offer was void if they didn’t receive confirmation from the seller by 11:59 PM that Saturday night. It was 7:30 PM Saturday when she delivered it. I responded by asking if we were in a hostage situation, and that I didn’t know where my sellers were on a Saturday night. Not only is it outside of business hours, but it is unreasonable. A deadline signals that the buyer, or their agent, is inflexible and demanding.
To win in multiple offers it helps to know what both the seller and the listing agent are looking for. Price is a major factor, but there are other contributing factors. You will get lots of advice from friends and family, but remember, they aren’t making the offer. Think of your offer as a presentation, use the 7 tips, and stay flexible. If the seller needs a different closing date, try to work with them so they will work with you. Congratulation on your new home!