Winning the bidding war: It’s not always about money

This market has lasted over a year now, and except for a handful of occassions every purchase or sale of a home I’ve been involved with has had multiple offers.  Going back to a buyer (not mine but another Realtor’s client) who was upset at our client and us for selling selling their property for close to $10,000 more than his offer… His rant to me was that we were greedy. If he only knew that the difference was only about $140 more to us (gross). For the amount of time and effort to negotiate multiple offers if it was about the money for me I wouldn’t do my best, but I thrive on my clients’ winning. 

Alright, back on topic… It’s pretty clear that in today’s market there are things you can do that can make your home buying and selling experience a successful one.

First, work with the right Realtor.  The right one, with the right experience and committment to you will make the difference. Not all agents are alike.  Some are great stagers, some are great marketers (Sara is a great marketer) and some have great negotiating instincts and abilities.

Second, write your best offer. It’s not always about how much you pay but what you offer.  In Alberta the statute of frauds governs that real estate contracts must be in writing . Not everyone can write a good contract, you’ll have to trust me on this.  This contract will govern all disputes and everything to do with the property, even after you’ve taken possession.  My experiences sitting with sellers and discussing what has appealed to them when reviewing offers on their properties have taught me some simple things you can do to make your offer as acceptable as possible based on:

• Prepare.  Get pre-approved and have a copy of your pre-approval for your Realtor.
• Review the contracts before making an offer.  Preferrably before getting into the emotional blender of looking at properties.
• Get your deposit monies in order.  If you followed the previous steps you’ll know that you’ll need a deposit.  The amount of which could mean paying less for the property.  To be clear you don’t need a deposit for your offer to be valid, but if you’re like any seller I have who is counting on this transaction so they can go on to do something else, a larger deposit will help.
• Have your team together and organized, this means lenders, lawyers, inspectors, and any parties that may be assisting you.  Having your team organized means if you can get conditions in (highly recommend) you can keep them as short as possible, which is very attractive to sellers who are trying to determine who is serious about buying their property and who is trying to buy some time.  This also includes insurance companies if it is an older property, and condo document checking companies if it is a condo.
• Know your limit.  I have witnessed buyers paying thousands more for a property after losing on a few properties, just so they don’t have to go through it again.  Thinking that you can buy a property that has just come on the market, and has multiple offers for less than list price is more than fool’s optimism, it’s a waste of your time.  We just recently paid $45,000 above list price – something that seemed absolutely foreign to me two years ago – because that was the property for us.  So as we talked ourselves in and out of the transaction we weighed our longterm options and it was clear that this was the one.  Even if we could buy a much nicer property just 5 minutes away for $20000 less. 
• Get confirmation of exactly how many offers are being presented, then document this and confirm it at presentation time.  If possible, be at the presentation with your Realtor even if the offers are being faxed to the seller.   I have been astounded by the number of times I’ve had really good offers faxed to me when the seller was reviewing them personally. Often if the seller knows there are buyers outside the home the seller chooses their offer, because they were present to make an immediate change to the offer that was favorable to them. I’ve had to cancel or miss numerous family engagements in this market just to be present for my buyers to have the best shot possible.  Remember. the seller is in the driver’s seat for the most part, so it is possible that they will change the presentation time so you have to be flexible. Fortunately I have 3 very capable people who can sub in for me in an emergency.
• Make your offer clean.  Don’t clutter your offer with lots of terms and conditions when a few will do the trick.
• Remember your Realtor represents you, and if you are representing yourself then have fun and learn fast, because you’re probably going to have to do it a few times.

• And last, the best advice – talk to the members of your team and ask questions.  There are no bad questions just bad assumptions.

Remember, if you want something bad enough you’re probably going to have to pay top dollar, and even then that might not be enough.