NAVIGATING THE MULTIPLE OFFER MAZE
The Arizona real estate market is hot. What has caused such a frenzy? “Mortgage rates have dropped to an all-time low, and with quarantine orders which allow many people to work remotely, the Rim Country and its wonderful landscape and climate have been a huge draw to a profusion of buyers!” said Kelly Giurbino, Broker, Berkshire Hathaway HomeServices Advantage Realty.
It’s a Seller’s market, and an area like Rim Country is full of demand for houses and land, but the current supply is scarce. This combination often creates both stress and opportunity for buyers and sellers. As soon as a well-priced property goes online, there is a surge of interest by those who are looking in that price range, some newly looking and others who have missed out on properties in a previous multiple offer situation.
Whether you are the Seller or Buyer, let’s go over the highlights of the process and allow Kelly Giurbino, who has juggled as many as 42 multiple offers on a property, and commonly and calmly negotiated successful sales with an average of 10 offers per listing.
Sellers rely on advice as to what to do to make their property “market-ready.”
A feature of the property that may need repair can end up deterring qualified buyers. If something needs to be fixed before launching on the market, it’s best to attend to that no matter how hot the market is because it will likely come up in the escrow process later. If you address or fix it now, will your property be worth more when you launch?
Buyers are unaware of conditional items when making an offer.
This may hinder their confidence in a multiple offer situation. So, buyers, would it benefit you to have a home inspector or contractor join you when seeing the property – or obtaining the seller’s permission to look deeper before making an offer? If so, and you are then able to waive that contingency upfront, your offer terms may be cleaner than others.
Sellers need a solid strategy.
To define that strategy, they will seek guidance and advice from an experienced broker/agent before listing the property. When the property goes “live” showings begin. Would it benefit you to consider setting an Offer Review Date? “One very important strategy when representing a Seller has to do with working smart on their behalf to negotiate the highest possible price with the best terms, and to do that I frequently recommend that we allow their property to be on the market a week before reviewing offers. We don’t know who was out of town and not able to see it immediately, and that buyer may have submitted the absolute best offer on the property. Solid, serious buyers are not going to disappear because you wait a week to review and respond, and if they do, they wouldn’t be the offer you were hoping for anyway,” said Kelly Giurbino.
One of the most critical components of this is to HONOR your date. If you set an offer review date, buyer’s agents may not submit their offer until closer to it so the seller and listing agent really need to stick to what is in the MLS in print. When selling your home, there’s plenty to consider. Your Berkshire Hathaway HomeServices Advantage Realty listing agent is there to explain everything so you can make wise decisions that work best for you.
Buyers need to have a solid search strategy.
There are various portals buyers love to use, and they are good sources. However, remember that all of the data is sourced directly from the MLS, so for the most current and accurate information, your agent can set you up on a MLS-driven search for the area and price range you desire.
THIRD, BEGIN NEGOTIATIONS…
Seller’s agents have great opportunities as their phone is blowing up!
Each call or text is how they professionally begin negotiations on the seller’s behalf. As we implied, patience and waiting a week, for example, only allows you more exposure. A good thing. Hire a broker/agent who is able to confidently and courteously open the home to prospective buyers – while maintaining the necessary composure to handle the strategy. Yes, we at BHHS Advantage Realty are well known and respected for just that type of strength.
Tips for Buyers in a Multiple Offer
· Have a strong (not to be confused with aggressive) negotiator on your side. That involves good communication and instant relationship building skills. Berkshire Hathaway HomeServices Advantage Realty Agents are skilled in offering advice about buying strategies through the negotiating process.
· Find out the seller’s needs before writing. Do they prefer a quick or a longer escrow? Do they want to take negotiable appliances and/or furniture when they move? The more you can adjust to their needs, the more attractive your terms become.
· Know that the confidentiality of your offer is dependent upon the seller. They can instruct the listing agent to share the offered price or terms, or not. That is why offers with an established due date for review often are submitted just prior to the deadline.
· Ask your agent about the use of an Acceleration Clause – it automatically increases your offered price given its well-written incentive and parameters. This is yet another skill of the agents/brokers at Berkshire Hathaway HomeServices Advantage Realty.
· Within acceptable guidelines, offering concessions that make your offer more attractive.
FOURTH, OFFER REVIEW & RESPONSE
Sellers ask, “Do I counter the best, some, or all Offers?”
You have nothing to lose by countering all offers in the first round of negotiations. It allows buyers to better understand their position and do what they will or can to be the best or understand it’s past their ability to respond. “Certainly, focus on the best (price AND terms), but unless someone is clearly low-balling the property’s value, often I recommend we counter all buyers in the first response sent out. It’s a lot more work, but it’s a professional courtesy to buyers who have shown interest, that often has turned the tides for my client,” said Kelly Giurbino. It is more effort for your broker/agent to respond in a multiple format, but they know ways to form a general response, later getting specific with the offer you ultimately accept. At times, terms are removed by the buyer or requested removed by the seller. Keep in mind that a buyer’s due diligence time period is beneficial to everyone. Focus on solid, serious and terms – and be careful to curtail being greedy or misinterpreting the multiple interest. It can go as easily as it arrived. “As a broker, I prefer to close a sale that allows all parties to exercise standard contractual rights. We may reduce time frames, if it makes sense, but I don’t recommend taking the due-diligence part of the process away,” commented Kelly.
Buyers rely on their broker/agent to make it personal.
Building life into your “paper” offer from the standpoint of understanding that all sales involve personal relations. Forming a good connection with the listing agent, who communicates with the seller, is key in one facet of standing out in a stack. The seller gives the agent instruction as to whether they can share the price or terms in hand. In situations when it’s THE property for a buyer, through your agent you do your best to get a feel for how you can stand out, but the simplest advice would be to make your walk-away offer, and if you get it, or do not get it, you have no regrets.
“When I have represented sellers, I assure them that all buyers, including any that come through or to me, will fall into the same strategy discussed in this article. Fair is fair.” Said Kelly
Hoping this article was beneficial to our clients and customers, past, present and future. We are here to serve you and do so with the highest quality of brand and professionalism of agents. If you would like a market analysis on your property or a search set up to buy, reach out to us!
If you would like more information on this topic and others real estate related, reach out to us at 928-474-2337 or via out website: www.paysonarea.com. Our offices are conveniently located in Payson, Pine and Happy Jack, Arizona.
Berkshire Hathaway HomeServices
Advantage Realty Offices:
Payson, AZ - 609 S. Beeline Hwy
Pine, AZ - 3640 N. Hwy 87
Happy Jack, AZ - Hwy 87 at Clint’s Well in former auto shop