The market is blazing hot! That’s all you hear these days. Agents are working triple overtime, but it’s not for reasons you might think. The Wistrick Team isn’t negotiating the best terms on one offer anymore, we are often negotiating dozens of offers … all for the same listing.
Negotiating multiple offers is more art than science. Let’s say we receive an offer well over list price, but the buyer needs financing and they want seven days to inspect your home. This time last year, that would be a slam dunk. But in today’s world, chances are we’ll receive a second offer that might be slightly lower, but it’s all cash and the buyer has removed all contingencies. Which offer is better? The higher sales price or the lower risk? That’s the million dollar question and why it pays big time to have a pro analyze offer details. Other terms that typically come with an offer are appraisal contingencies, personal item requests, closing date, quality of the buyer’s lender, a reputable closing attorney, amount of earnest money they put down … and the list goes on and on!
Most agents focus squarely on the offer price and fail to educate their clients on other pitfalls that could cause the contract to fall apart. Our team thoroughly vets every player in the transaction, from the lender all the way to the closing attorney. Oftentimes, we will find clues that could crush a deal and force the seller to start all over. So, it’s not just the offer price, it’s every other component of the offer. Sometimes the highest offer isn’t the most lucrative, especially if it never makes it to the closing table.
In this market, some (not all) agents representing buyers are trying to get very “creative.” They will write offers without an appraisal contingency, however, they will try to slide the appraisal in during the buyers due diligence. If the home doesn’t appraise, the buyer attempts to negotiate the price back down, or they terminate. We’ve seen offers come through that claim they are not contingent upon the buyer’s home sale, but they will stretch out the buyer’s financing contingency in hopes that their home will sell within that period. If it doesn’t, the buyer will terminate because they don’t qualify for two loans. Some offers will purposely miss a section in the contract, but will offer a zero day due diligence (meaning they’re buying the home as is). Then they slip in an inspection, and if they don’t like what they see, they will find a loophole in the contract to get their clients out scot-free.
Trust me, these stories could go on for days, but we’re just giving you a glimpse into the drama that is coming with multiple offers. Working with an inexperienced agent to sell opens the door for seasoned agents to take advantage of them.
“If the market is so hot, why do I need an agent?”
Now, more than ever, you need to have one. If you know someone who sold By Owner, I almost feel bad for them because it’s a guarantee that they left tens of thousands of dollars on the table because of the lack of exposure they didn’t receive by not professionally advertising to the masses. If they received 10 showings By Owner, they could’ve had upwards of 50 showings and five times the offers if they were listed by our team. Not to mention, looking through hundreds of terms with 15+ offers is not for the faint of heart, especially for someone who doesn’t do this for a living.
Ok, so what terms are we looking for in these offers in order to keep our clients protected?
So what’s the moral of the story? Mega-marketing drives as many offers as possible. From there, organizing and negotiating each offer in order to meet the most ideal terms for our sellers is key. Just when everyone thought a hot seller’s market makes it simple to sell, the reality is this unprecedented market is a whole new ballgame that will leave homeowners screwed out of the best possible situation. Most of the time, they won’t even realize it. They’ll just be excited they got a contract in 3 days.