Getting Your Offer Accepted in Multiple Offer Situations

If you are in the market to buy a home chances are that you will find yourself in a multiple offer situation. With both interest rates and inventories at record lows, multiple offers are becoming the norm – close to half of all homes sold in our area receive more than one offer. So let’s have a look at what you can do make your offer stand out from the crowd and gain acceptance.

• Make a strong offer right from the start – offer what you think the house is worth and it just might get accepted. Worst case the seller will recognize you are serious and may just negotiate with you.

• Consider increasing your deposit – if you are putting down 20% why not make your offer stand out with a 5% or even 10% deposit. Your offer will certainly standout from the crowd and show just how serious you are. Your deposit is protected by the various contract contingencies to be sure to follow them closely or risk losing your deposit.

•  Consider reducing your contingency periods – in California a typical buyer inspection contingency is 17 days – why not lower that to 10 days which should provide ample time to complete your due diligence. This move will differentiate your offer from the others with standard contingency periods. If the sale does not work out the seller will be able to put the home back on the market sooner -  a plus for them.

• Use an escalation clause in your counter offer – consider countering with a solid price combined with an escalation clause where your offer price can be increased up to a maximum price and by $1,000 over the highest offer a seller receives.

•  Write a personal letter – a compelling letter stating why you love the home demonstrates that you are a serious buyer and will follow through on the deal. Yes, even sellers are people and just maybe they will appreciate what you have to say.

• Get “Preapproved” if possible – a preapproval letter from your lender carries more weight than a prequal letter. If you are a buyer today, plan on being in a multiple offer situation and get this in place.

•  Cash Buyers – advantage to you – make a strong offer and consider making your close date very short. This can work well if the home is vacant. If owner occupied it is likely not an advantage but your ability to waive an appraisal contingency and shorten other contingencies to 10 days or less is a significant advantage. Cash is a great tie breaker but will not get you a home for much less (if any) than a traditional buyer – those days are gone.

In closing, it is still a great time to buy a home. Interest rates are still hovering in the mid 3% range and home prices are still well off their 2007 highs. Now is the time to buy and hopefully these tips will help you navigate a multiple offer situation or better yet avoid one by getting your offer accepted quickly.

David Grbich is the Broker owner of Ventana Coastal Properties and serves the needs of buyer and sellers throughout Orange County, CA. If you are looking to buy or sell Orange County Real Estate give me a call at 949-500-0484!