How to Get Your Offer Accepted in a Hot Sellers’ Market

Our hearts go out to all of the house hunters out there who are trying to snatch up just the right property in this hot sellers’ market. We watch the market every day for our clients, we text them immediately when something great is listed, we all scramble to see the house and get the offer in, we write fantastic offers well above list price – and we still sometimes get beat by cash offers.

We do, however, WIN bidding wars more often than we lose them. (We once won a bidding war against 31 other offers!) Experience has taught us some great tricks for getting an offer accepted when the competition is fierce. Some of those tricks are shared below. (We can’t share them all – we need to save the best ones as secret weapons for our clients!)

1) Find out what is most important to the Sellers. We always call the listing agent and ask what the Sellers need in terms of closing and possession dates, and we are always trying to write an offer that the Sellers can just sign without having to further negotiate any details or make any changes.

2) Work with a local lender with a great reputation. This is essential in a hot real estate market like Ann Arbor. It is important that Sellers and their agent have no concerns regarding the solidity of your pre-approval and the lender’s ability to align a smooth and timely closing. If your agent tells you that your pre-approval letter from a big national lender is going to hurt you more than it helps you, you are smart to listen to your agent. (We have actually won bidding wars based entirely on the great lender our client was working with.)

3) Make the terms of your offer as clean and attractive to the Sellers as possible. We just had a hot listing that received multiple offers. One of the Buyers who made an offer could go cash, but chose to finance instead. That Buyer came in first for price on the offer, but lost the bidding war because she insisted on financing what could have been a cash purchase. (She lost to a cash Buyer who offered a little bit less than she did.) The more unknowns you can remove from the Sellers’ minds, the better.

4) Don’t ask for the Seller’s personal property. If the Sellers are not including the washer and dryer, don’t ask for them. If you are hoping they will throw in the boat or the riding lawn mower, but those items are not listed as included in the sale, don’t ask for them with your offer.

5) Keep contingency periods as short as possible. While the Sellers may not want to close right away, they do want to know that everything is going to work out fine as soon as possible. This means applying for your loan within a couple of days, and keeping the house inspection and financing contingency periods as tight as possible.

6) Offer a higher earnest money deposit. We just had a Buyer put down a $100,000 earnest money deposit on one of our listings. (That must be some sort of record!) That Buyer did win the bidding war. (Though it was not entirely because of the EMD, it certainly didn’t hurt.) You don’t have to go anywhere near this high on an earnest money deposit, but if you might normally put down 1% earnest money, boosting it to 2% or 3% could help you win a bidding war.

7) Be prepared to pay well above list price. At the time this is being written, nice houses in Ann Arbor are selling immediately for around 10% above list price. In this market, you must be prepared to go well above list price in order to compete. (We have some strategies for just barely winning bidding wars that may help you secure the house without paying way too much for it that we would be happy to share with you.)

8) Offer a sales/appraisal bridge. When there are many offers on a property, the winning bid is almost always either cash or one in which the Buyer is offering to make up the difference between sales price and appraised price. Offering a solid bridge can help to level the playing field with cash buyers.

9) Offer some free occupancy time post closing. It is becoming more and more common for Sellers to need some time in the house after closing. This is so they can get the funds from the sale to fund the house they are buying, and also have time to move. Some Sellers need several weeks of occupancy, so offering to let them stay for free can really sweeten your offer. Since your first mortgage payment isn’t usually due for a month or more after closing, it can be smart to offer the Sellers this time, especially when it may make all the difference in getting your offer accepted.

10) Write a heartfelt letter to the Sellers and include photos. Neuro-scientists have proven what most of us already know: people largely make decisions based on emotion, and then use logic to justify those decisions. The more you can personalize your offer and generate some positive emotion, the more likely you are to get your offer accepted. Including a heartfelt letter that tells the Sellers a bit about you and your family and explores what you love about the house will have the Sellers (and perhaps even their agent) rooting for you to win.

If you’re looking for a buyers agent who will watch the market every day for you and text you whenever a property you may be interested in is listed, please give us a call or send us an email. We love helping our clients win bidding wars, and would be very happy to help YOU next! (734-945-7591, TheBrennerTeam@gmail.com)