Buyers in this market are forced to deal with low inventory, increased competition, and yes, multiple offer situations. Many buyers and agents dread the multiple counter email they get requesting their buyers “best and final” offer.
Well fear no more! This is part 2 of 3 (read part 1 HERE!) in a series that discusses a few of the many things that you can do to position yourself above the competition. These strategies have been incredibly successful for me and my clients.
Tip #2 – To structure & submit the most competitive offer, you must know what is important to the sellers.
Everyone expects that the most important thing to the sellers are best price and terms, including a quick close, and while it’s true, most sellers do typically want the best price with the best terms, often the best “terms” can vary and price can be superseded by other factors.
For example, I’ve been on the listing side many times when I’ve had sellers tell me it’s very important who buys their home. I’ve even had client’s turn down a higher offer (cash offer) because they didn’t want an investor buying their home, choosing a family instead.
It’s not always about a quick close. Yes, the sellers want to make sure the buyers are qualified and can close, but often the seller needs time to make plans, find a new home, move to a new area, etc. Often they want a longer escrow, or a special concession like a rent-back, especially in a seller’s market.
It’s imperative that the agent representing you finds out from the listing agent what is important to the seller(s) so that can be part of your offer. It’s also important your agent gets this information so that you can incorporate it into your buyer’s letter to the seller.
I don’t want to beat a dead horse as most buyers nowadays know that a buyer’s letter is a good thing to include in an offer, along with pics of the family, etc, and it is, but it needs to be done with a purpose and in the right situation.
First, as I mentioned before, the letter needs to written to not only be complimentary about the sellers home/neighborhood, but it needs to show evidence of why they really want/need to purchase this home.
Too often I see generic buyer letters. You don’t want sellers asking, “why was this written to me?” And you certainly don’t want it to seem like something the buyers put together in 5 min, or more cynically, that the agent put together, thinking it would make their offer look better.
This is often counterproductive, as it becomes impersonal to the sellers, and it’s a waste of time. A buyers letter needs to be specific, come across as heartfelt, and speak to what is important to you as the buyer(s), and to what you know to be important to the seller, following your agent’s discussion with the listing agent.
Maybe your agent finds out the seller is a longtime teacher and is retiring after living in the house and the community for 20 years. If I find this out and my buyer is a new teacher just starting out, that’s certainly something I am going to recommend they include in their letter.
These are just a few examples of why it is so important to know what’s most important to the seller. Again, usually it comes down to price and terms, but in a competitive multiple situation, if the buyer’s agent is doing their job, price and terms are often fairly close. In this situation, you want the opportunity to distinguish yourself from other buyers so the seller wants to accept your offer.
We discuss even more strategies for winning multiple offers in Part 3 of this series!
In case you missed part 1 of this series, check it out HERE!