The recovery of the real estate industry was definitely unexpected and maybe the overall silver lining amidst the pandemic. Most companies are adopting the norms of social distancing and most people finding comfort in work from home, demand for new homes is skyrocketing. With competition high and the lack of inventory making it no better, sellers are facing multiple offers and bidding wars.
Closing a deal for an agent is always a feather on their hat, more so when the deal is won through a bidding war. It is an important moment for all agents or brokers to show their standing as well as their capabilities amongst all potential clients as well as fellow colleagues. Its never too late to have a few tricks up your sleeve. Besides the obvious, overall purchase price, which for most sellers might be valued most, that need not necessarily be the only factor that helps them choose a buyer.
After the overall purchase price, most often the second factor that every seller pays attention to is the closing date. The ability to close the deal in a short and swift manner will always play a role for the seller when choosing the buyer. Remember, understanding the seller’s requirements and being flexible to their preferences will always give you an upper hand.
Being clear on all the costs your client is willing to cover will give you a great advantage. Providing assurance of a preferably large amount as earnest money will definitely gauge the attention of the seller, especially when you are trying to get other concessions. The amount can be the buyer’s choice but larger the sum, more the attention.
The appraisal gap coverage is also a sure-shot pleaser. An appraisal gap coverage is one where the buyer states in their offer that they will cover any discrepancy between the offer price and the appraisal value.
An important aspect that plays in the mind of every seller is the inspection. Getting your client to agree to take the house as-is will definitely spark an interest in the mind of the seller. Setting up a few clauses on inspection of the house like restraining repair requirements to only those of health and safety issues as well as agreeing to a fixed cost limit will definitely help get your client on the good side!
Another great idea is being prepared with a pre-approval letter from lenders. This one works well, especially when competing against cash offers. Ask the lender if they are comfortable waiving the loan termination provision of the contract.
This will instill confidence between the seller and your client. It gives the seller an insight on the strength of the mortgage candidate the client is!
A post-close occupancy agreement is another way of creating a connection between the buyer and seller. Providing a leeway to accommodate the seller is sure to strike a chord. Be aware of the seller’s plans by asking the listing agent and offer a free rent arrangement for the seller to reside in the house until they find replacement home. Being accommodative can go a long way!
Bidding wars are never easy, no matter your experience in the industry. Whether you’re a newbie agent or well-established broker, it’s always good to have a few sure ways to give your client an edge over the other offers.
Always remember: ‘Going above the asking price doesn’t always sweeten the deal’