More is always better! Likewise, getting multiple offers if you’re selling a home is always better than only getting one.
Still, you can’t take advantage of more than one offer if you don’t know how to manage all of the attention. How do you know which offers are solid? How much more money can you get now that everyone wants what you’re selling!?
Now that the pandemic is starting to look more like water under the bridge, home buyers are coming out cash in hand, and Zillow listings burned into their minds. So, before you get overwhelmed, let’s look at how you can cope with the new, increased pressure.
Starting With the Basics, Winning a Bidding War
In the world of real estate, getting multiple offers is referred to as a “bidding war.”
Bidding wars call for a gentle touch. Buyers get worried about being priced out of their dream home, and sellers worry their offers will fall through when the stress becomes too much.
At the start of a bidding war, maintain your calm. As the Agent in charge of the sale, it’s your job to mediate multiple offers and multiple counter offers at once. Without your level-headed approach to the situation, buyers will walk away and sellers will break down.
It’s important to remember that victory during a bidding war means making the sale, not making the most money possible. So long as the best offer is acceptable to the client, then you’re good to close the deal.
Know When to Hold Em’: Tips Specifically for Managing Buyers
Managing buyers is probably the most stressful part of a multiple offer scenario. They are the people that you know the least about, so they’re much easier to lose than your seller.
Here are five tips specific to managing buyers during a bidding war.
Request that all final offers for each round of bidding be submitted by a specific day. Setting a deadline gives buyers something concrete to grab onto in an otherwise ambiguous situation.
A deadline is also a great motivator if you’re about to close a sale or need your Buyer to push a little harder for that medical professional home loan they’ve been negotiating.
Vet Your Buyers’ Lenders
Is it possible that the Buyer is taking out a high-risk loan to afford the house that you’re selling? Maybe they’re leaning on a lender that’s likely to default on their payments.
Just having money is no good if that money comes from an unreliable source. So, if you notice that your Buyer is using an unreliable financier, you might want to bring up the subject as a potential red flag.
Ask the Buyer to be Honest About Their Contingencies
Many buyers need to fulfill specific, personal criteria to complete the purchase of a new home. That could mean finalizing a loan, selling a house, or moving across the country.
Always ask your Buyer to be open and honest with you about what they need to make the deal work.
Make Sure the Closing Date Works With the Buyer
Ultimately, the fate of your sale comes down to the Buyer paying you and the seller for the house. So, you need to make the time frame for payment painfully clear. Be persistent with your reminders, even if that means being a bit annoying.
Bigger Isn’t Always Better
There’s a pricing sweet spot that you have to hit with real estate. You need to sell for an amount that makes your client happy. You also need to sell for a realistic price.
Banks will often only loan money equal to the appraisal value of the house. If your Buyer is offering above that, chances are the bank won’t lend to them when you try to close the deal.
Know When to Fold ‘Em: Tips for Managing Sellers With Multiple Offers
Sellers get excited quickly. When a new offer comes in, it seems like their life is about to change. They can move, they can renovate, they can make create their dream home.
Here are four ways to help sellers temper their excitement and up their chances of a sale.
Keep the House Walk Through Ready
A request to look at the house can come through at any time. Your seller needs to be able to show their home at the drop of a hat.
Offering this kind of accessibility makes their house infinitely more desirable to potential buyers.
Evaluate the Buyer’s Offers
When you get an offer in, does it seem like the Buyer is upfront with the amount of money they’re willing to spend, or does the offer seem like a low ball?
If a buyer seems to be approaching negotiations with an obvious intent to get the lowest price possible, they might not be worth you or your seller’s time.
A great thing to look for is a handwritten letter or other olive branches at the start of negotiations. This signals that the seller doesn’t intend to give you grief.
Always Remember What the Market Can Bear
A house priced above market value won’t get offers. Pricing above market value places your seller in a stressful position and you in a bad spot.
Sometimes it’s a better idea to price slightly below to encourage a multiple offer situation.
Be Persistent and Optimistic
There are plenty of chances to learn how to handle multiple offers on a house. So, don’t jump on the first offer that comes your way, and don’t be discouraged when a potential buyer leaves.
Most of all, don’t get desperate. That only leads to more stress and bad sales.
Deal or No Deal?
The better you are at creating a stress-free, open and honest conversation between your seller and your buyers, the better off you’ll be.
You’ll find the right Buyer, eventually!
So, how’re you feeling about handling multiple offers in the future? We hope that these tips made you more confident about bushwhacking through the jungle of buyer-seller negotiations.
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