A Smile Goes A Long Way When Dealing with Multiple Offers
Indeed, multiple offers are back this season. I can actually count on more than one hand times that buyers have lost out on a home this season. It’s always devastating for them! The supply in south Florida, while still very high, does not have the excess investment properties, must-sell Sellers (who already purchased something else), and builder spec homes. 90% of that surplus of inventory dissipated in the past 6 years like a slow dripping faucet. Eventually the drips (buyer purchases) add up and the bathtub overflows. If the bathtub size (supply) were expanding, this would be ok, but builders have been constructing homes at historic lows.
In Palm Beach County, we have seen a 12% drop in supply from this year compared to last year. Today’s buyer on average also has different values. They want new construction (which is now defined as 2000+ since there is no new inventory), low HOA fees (this has replaced luxury items), and location-location-location. Homes fitting this description are the ones typically receiving the multiple offers. The other category are short sales, since they are marketed at a must-sell price or sometimes below. Whether the short sale gets approved or not is an entirely different story. If a buyer is purchasing in this category, they need to be aware that they aren’t in a complete buyer’s market anymore. Below are the following strategies I work on with Buyers.
Prepare a Buyer
It’s important the client is aware of what is available, what is under contract, and what has sold. Going through details of statistics in advance is vital.
Most clients just don’t believe the market isn’t god-awful until they lose out on something. It’s important to show everything and then some. Sometimes looking at everything gets the point through.
I share stories about how clients lost something in advance.
I ask my clients to visualize that they lost the house and how would they feel in a week if they lost it. Try to picture the future.
Visualizing is not enough. I make them promise and shake my hand that they won’t come back and say I wished you pushed me harder. This gets them to really think about it.
New Properties Will Come On Higher
Homes that have been on the market the longest are often the ripest to sell. When homes sell faster, prices go up. The new listing is going to want more for a least the first 90-180 days.
Give The Lady What She Wants
An old selling by Chicago merchant, Marshall Fields. Give the Seller what they want. Be nice, offer cash or at minimum a preapproval letter, close to 10% down, closing time that the Seller wants. No one wants to do business with an insulting bottom dweller. The Seller doesn’t want headaches. Present yourself as the nice person you are. A smile goes a long way.
Like in the Rocky Balboa movie. Mickey had Rocky chase those chickens. Get your offers in fast with the same day or next day acceptance time. Sellers will take the time that is allotted to them. Make decisions faster and cut down on the possibility of multiple offers from coming in from the get-go.
Sign up for internet IDX automatic emails on an hourly basis. Knowing about the listing first will give you a head’s-up over the competition.
While not always great for the Seller, they offer free options on tying up the house. Once under contract, Sellers will usually agree to repair items because they will have to fix it up for the next guy. Once under contract, the negotiating power will even itself out.