How can a North Lake Tahoe buyer avoid multiple offers?

The North Lake Tahoe real estate market is favoring sellers today.  The number of available homes and condos for sale in the area is extremely limited.

As of Wednesday, June 14, 2017 we had the following for Tahoe City, Carnelian Bay, Tahoe Vista, Kings Beach, Homewood, Tahoma, Meeks Bay and Rubicon Bay (TSMLS Areas 1-5):

• North Lake Tahoe Homes for Sale: 132 Homes
• North Lake Tahoe Condos for Sale: 47 Condos

At our lower price points inventory levels are even tighter.

• For example: North Lake Tahoe condos for sale under $400,000 there are only 12 units, or only 25% of all condo listings on the North Shore, West Shore, and greater Tahoe City area (TSMLS Areas 1-5) are under $400,000 in price.
• Another example of limited inventory in our lower price points, North Lake Tahoe homes for sale under $500,000 there are only 12 homes listed for sale, or only 9% of  the homes on the market on the North Shore, West Shore, and greater Tahoe City area (TSMLS Areas 1-5) are under $500,000 in price.

Low inventory levels mean a North Lake Tahoe home, or condo buyer is likely to be in a multiple offer situation for new listings that are priced right, or are in our lower price points.

How can a North Lake Tahoe buyer avoid multiple offers?

• 1) See the property immediately – now, today, tonight.  Do not wait until the weekend. Do not wait until after the holidays.
• Time is your enemy during the first week to ten days of a new listing.  Second home buyers are at a disadvantage and often can’t come up and see a property on the first few days it is listed.  If you can, you’ll score a buyer advantage.
• Look and make an offer on Holidays – Like most Tahoe second home buyers you have a busy life and a lot of plans.  Often holidays can work against you, but if you can look and write your offer right on a major holiday, you can often score a buyer advantage.
  • Last winter I had a buyer that made an offer on December 23, 2017, the first day the new listing hit the market.  The timing was horrible for her, right before the holidays, but she knew it was a buying opportunity.  By December 24, she had an accepted offer without being in multiple offers.

If you think the home was a dud, think again.  Price at $399,000, her offer was above the listed price and was accepted.  The entire process was less than 24 hours.

After the holidays were over, a back-up offer was accepted by the seller that was much higher in price.  The back-up buyer had holiday plans and just wasn’t available to see, or write an offer when it first came on the market.

If you can take advantage of holiday periods when other buyers are distracted, or have put their searches on hold for a few days because they have holiday plans, you can use that to your benefit in the Tahoe market.

• 2) Write your offer immediately.  You’ve seen the property, like it.  Make the decision to buy it right away.  Write your offer the same day.  Do not worry about holidays.  The sooner you present your written offer to the seller the better.  Don’t forget, most agent use electronic signatures, so your offer can often be signed right on your phone, tablet, or laptop!
• 3) Write your offer for 3-5% above the asking price.  Right now our market is hot, so you’ll need to be above the listed price.   For example if the property is priced at $399,000, then write your offer for at least 3% above the asking price.  In this example you’d offer $410,000.
  • Now is not the time to discount your pricing.  If the property has been on the market for less than two weeks, write at, or above the listed price.
• 4) Have your finances ready to go.  If you need a loan, your offer goes with your loan pre-approval letter with your offered price on it.  If you are cash, you have your verification of fund statements ready to go if the sellers’ agent asks for them.
• 4) Give the Seller a very short window to respond.  If you can submit your written offer to the sellers’ agent by 6 p.m., then only give the Seller until 11 a.m. no later than 12 noon to respond.  Do not give them all day.   The more time to respond, the more time another buyer has to write their offer.
• 5) Quick Response to a Seller Counter Offer – Lastly, the seller may need to counter you on specific terms. It happens, so if you receive a Seller Counter Offer, review it, and make your decision right away on how to respond.    Accept it, or counter it, but do it right away. 
  • The sellers may have given you several days to respond, but remember they have the right to withdraw their counter to you prior to your acceptance, not the response deadline time.  That means if another offer comes in, even though you have been given so much time to respond, if you have not accepted the sellers counter offer, the seller can with draw their counter to you.  If you countered the sellers’ counter offer, and another offer comes in, the seller does not have to respond to your offer.  They will have options, and that is how you can still end up in a multiple offer situation, even though your offer had been the only one being considered.
  • If you need to counter the seller again, make sure they have a small response time.  I know this sounds like a broker record, but again, the longer the negotiation goes on, the more at risk a buyer becomes of another offer coming in and ending up in multiple offers.
  • Until you have an accepted offer, either side can stop the negotiation process. 

The bottom-line is, when you offer above asking, combined with having your funding ready to go, along with a short response time, the seller has to seriously consider what you have proposed to do.

A seller is going to want to wait to see if they will get more offers.  Their knee jerk reaction is, “we priced it too low”, or “what about the other buyers”?

Yes, the greed factor will come in, but since your offer has a short window to respond, until another written offer comes in, which need to be before your offer expires, it’s hard to not negotiate with the buyer that has acted immediately and presented an above asking offer.

A good sellers’ agent is going to explain to their sellers the “bird-in-hand theory” and do they want to lose you as a buyer by waiting and letting your offer expire, on the chance that maybe a better offer comes in?

It’s always a tough choice for a seller.  Take the offer in front of them right now, negotiate terms with that buyer, or gamble for something better.

Will this buying strategy always work?  Not always, but it is a good Tahoe buyer strategy to try in a hot market.  Worst case, another buyer comes in and your attempt to try to avoid multiple offers has failed, but at least you tried.

Depending on how quickly you can act and present your written offer, you have about a 50/50 chance of negotiating without being in a multiple offer situation.

If you want to know more about our Tahoe market, or other strategies, call me, I can help you too!

For all of your Tahoe real estate needs – Laura Allen, 530.414.1260, Broker Associate, Tahoe Real Estate Agent, Tahoe REALTOR®,  Laura@TahoeLaura.com  CalRE# 01473598

www.TahoeLauraRealEstate.com

Coldwell Banker CalRE# 01908304, Tahoe City, California.

How can a North Lake Tahoe buyer avoid multiple offers?

Originally posted at:  http://tahoelaurarealestate.com/can-north-lake-tahoe-buyer-avoid-multiple-offers/