With the average price of a homes in Campbell River rising and inventory shrinking, the occurrence of multiple offers becomes more frequent. A multiple offer situation is when more than one buyer makes an offer on the same property at the same time.
If you are a seller this is great news, having more than one person offering to buy your home creates a bidding war and the sale price should rise accordingly. If you are a buyer, the news is not so good.
When a multiple offer presents itself, the seller’s Realtor® should instruct you that you are now in a multiple offer situation, and will be given a chance to present your offer at a specified time with the other potential buyers. It should be made very clear by your Realtor® that the offer you present should be your best and final offer as you rarely get a counter offer from the seller in a multiple offer situation. If another offer is more appealing to the seller then the one you present, it is generally accepted outright and you need to look for another home.
How do you make your offer more appealing?
- Offer more money. Who doesn’t want more money? Don’t overextend yourself though, talk to your mortgage broker and get a ceiling price before you make an offer. If financing allows, be bold on the purchase price. The average price of a home is rising, so if you offer more than what you would have offered prior to it becoming a multiple offer, a year down the track after you’ve been living in the home and making memories with your family, do you really think you’ll regret the additional amount that ensured your offer was the chosen one? If you decide to blow the competition out of the water and offer substantially higher than list price, you are not the first one to do that. That approach is for the brave and bold. Each buyer is their own unique personality, and personality can influence the amount offered, despite guidance offered from their Realtor®. Some buyers will cringe at the chance to compete in a multiple offer and bow out of the race.
- Increase your deposit. A larger deposit shows the seller that you are a serious buyer.
- Keep your subject clauses simple. The less clauses, the better. Keep the subject removal dates as short as possible. Talk to your Realtor® about what clauses to use to keep you protected and in the running to buy the home you want.
- Make your completion and possession dates flexible. Generally the sooner the better, but be willing to adjust them to the seller’s needs if necessary. It’s ok for your Realtor® to ask the seller if there are dates that they would ideally prefer.
- Get your Realtor® to ask the List Agent if the other buyers have any information that you don’t already have. Such as, what appliances the seller would be willing to be sold with the home. You don’t want to lose out on the sale because your offer asked for too many included items when the other offers did not. It’s a chance to sound out sellers needs and wants prior to submitting your offer.
- Best not knock on the seller’s door and have a private chat. Can you imagine how upset you’d be if you heard the competing buyers did that to you? That type of unfair approach can become costly if lawyers get involved.
Remember, that you may only get one chance in a multiple offer situation. The final outcome is that there is only one winner. The disappointment can be quite staggering if it is not you.
If you want to avoid getting into multiple offer situations, get your offer accepted as fast as possible as soon as you know that property is the one for you. Submitting a lowball offer, in a rising market, only keeps your offer open unnecessarily allowing others to put an offer in while you are countering back and forth with the seller. It can also prejudice a seller against you if it becomes a multiple offer situation, particularly when your offer and another offer are very similar.