Like it or not the real estate market in greater Cincinnati might force buyers to reset their goals to a new goal of “winning in multiple offer mania”. Some neighborhoods and homes are finding themselves in a seller’s paradise with buyers fighting over every property as soon as it hits the market. Unfortunately this phenomenon is not happening everywhere and it usually happens when a new listing hits the market at the right price. Notice I said “usually” there are instances when properties that have been on the market for some time finally drop their price and find themselves very attractive to a new batch of buyers.
While I’m not a fan of the term “bidding wars” from a buyer’s perspective multiple offers are bidding wars and somebody wins and somebody loses. The best way to prepare a winning strategy is to do your homework ahead of time and write a contract that appeals to the seller.
Cash Offers: Cash is king! But you better have an official document proving that you have sufficient cash to close ready to hand over with the offer. Think like a seller- 3 offers come in and 2 require financing and you have cash- it’s a no brainer. Except you didn’t plan ahead and secure written documentation and the seller isn’t going to wait 1 or 2 days while you scramble to verify funds.
Financing: Lender documentation that you went through the hoops to secure a loan once you find a property is a requirement. Sellers tend to look at the amount financed and while you may secure a loan with 5% down -the seller may opt to go with a slightly lower offer where the buyer is putting more money down and financing less. It happens. Also if you expect the seller to pay your closing costs factor the expense into your offer.
Contingencies: Try to write a clean contract. Contingencies for financing and routine inspections are pretty much the norm. Requesting time for in-laws to see the house or asking the seller to modify the property will most likely send your offer to the bottom of the stack. You and your agent need discuss contacting inspectors while you’re writing the contact to determine time frame for inspection period. Inspectors are hopping busy right now and you don’t want to request too short or too long of an inspection period. Too short could cause you problems and too long of a time frame may turn off sellers who don’t want to take their property off the market.
Flexibility: Closing and occupancy dates can be the ace in your hand. Sellers may be scrambling to secure their next property and may need to delay closing or require extra time to move. Buyer flexibility on these 2 issues may put the deal together. Sometimes time has a dollar value and while I’m not suggesting that you give up “valid rent” if required but your offer may win because you agreed to allow them 14 days to vacate versus just trying to outbid the competition.
Timing is everything!: You may lose a few before you win in multiple offer mania. If a hot property hits the market in the morning and you work until 6pm and by the time you view the property 3 offers have already been submitted- it’s timing. You need to be working with an agent capable of sitting in a car with you and then electronically submitting the offer to the seller’s agent. This doesn’t mean you shouldn’t read the contract and ask questions but instead of paper you might be passing an iPad or laptop back and forth.
Multiple offer situations are very stressful for buyers and their agents. Don’t shoot the messenger (your agent) because your offer(s) ends up rejected. Each seller is unique and tailoring a winning offer in multi offer mania requires a lot of work and sometimes- creativity. Need help finding a home- Contact