Multiple offers have become a fact of life for buyers in our market. There are many buyers who have lost out on multiple properties over the last several months. There are a number of factors at play that I’ll adres further down, but let’s talk about the one thing that makes the biggest difference-preparedness.
In order to succeed in a multiple bidding process you need to be prepared. The most important thing to start with is an experienced agent familiar with working in a multiple offer market. Not all agents are created equal if you have one who just hasn’t done very many or is relatively new or who isn’t proactive then you need to find one that has the correct level of experience.
Your agent needs to have briefed you thoroughly on the market. You cannot be surprised if a property has gone to multiple offers, if you’re surprised you probably haven’t got a chance. You need to know what properties are selling for and how quickly regardless of the list price. Knowledge is power and you have to be right on top of it or you run the real risk of never getting what you want or of potentially wildly overpaying.
You need to know exactly how much you can go to and your financing has to be rock solid. Not “we think we have a pre approval” solid but an application done and accepted up to your limit. If you’re in multiples and you have a subject to finance in your offer you’re dead, and if you haven’t protected yourself to be certain you have financing should you win in a multiple offer situation then bad things will happen indeed.
You have to be prepared to do your due dilligence immediately. Often a property will be on the market for a specified number of days before they are willing to look at offers-this is your window to do inspections and inquire at city hall regarding the property. Yes it will incur some costs but going in with a subject to inspection will likely also significantly diminish your chances for success.
Your agent has to be able to try to put in a bully offer. And make it go. A bully offer is one that is presented before the “presentation date” that you might see on a listing. There are some times a bully offer will be acceptable to a seller and you can preempt the multiple bidding process. This is where the experience and knowledge of your agent will be crucial. If your agent doesn’t know what a bully offer is or has never done one, get a new agent.
You have to be willing to not over pay for a property. We are seeing some downright silly prices being paid in some cases for properties that just can’t be justified. If you win a property in multiple bids but are paying wildly over market becasue you became so emotionally involved in the purchase are you really “winning”?
You have to be ready to make a move on a property immediately. This means knowing what you want and what you’re willing to pay for it. You need to have been in enough properties to make an educated decision about what you’re going to buy. You will not have a day or two to think about it. In many cases the difference between success and failure can come down to a couple of hours or less. This also means you have to have a responsive agent who will be able to get the wheels turning for you right away. Your agent doesn’t return calls immediately? Get a new agent.
You need to be looking at all possible alternatives. Your agent should be literally beating the bushes looking for the property that fits you. If you can find a property that’s not on the public system you can avoid the multiple offer scenario entirely and that can often be the biggest win out there-but your agent needs to be proactive and experienced in obtaining properties for their clients that arent officially for sale. If your agent has never just gone out and got the thing their client wants, then get a new agent.
There is a lot more to the actual mechanics of a multiple offer situation, such as being present outside while your agent is inside making your case, or drafting your offer in such a way that it will appeal to the seller on more than just the price- such as dates and inclusions, or taking into account information about the sellers that your agent has been able to obtain, or knowing how to handle the listing agent to get them on your side. These are all real factors that can contribute to the success or failure of your offer in increasingly common multiple offer situations.
If you’re worried about succeeding as a buyer in our current market or have not been able to get what you want in today’s marketplace I’d be happy to talk to you about it. Our spring market is getting ready to gear up in the near future and it will likely be more of the same for desirable homes in desirable neighbourhoods. Are you prepared and have you got the right agent on your side? My direct number is 250 858 5575.
Happy New Year and good luck out there!