Jim Valentine: Navigating multiple offers

Isaac Brekken/Associated Press "For sale" signs hang in front of homes on Cumberland Hill Drive in Henderson, outside Las Vegas on Tuesday.

Isaac Brekken/Associated Press "For sale" signs hang in front of homes on Cumberland Hill Drive in Henderson, outside Las Vegas on Tuesday.

The current dynamic real estate market in Northern Nevada is generating many multiple offer situations. In fact, it is rare to not have multiple offers on a listing right now. Multiple offers may seem exciting in concept, but they are really a nuisance for all parties involved, yes, even the sellers.
Sellers are faced with the choice of deciding which offer to take. Do we take the highest offer, the one from the family with the little kids that so enjoyed the backyard, or the most likely to be able to perform on the terms presented? It is the agent’s responsibility to present the offers in a manner that the seller can best evaluate and compare them for their financial benefits as well as the risk of each of them.
Many buyers are distressed right now. They’ve made offers on numerous properties and have not been able to contract to buy a home. They are so desperate that they are making offers at substantially over the asking price. Sellers need to determine if they are going to be able to perform on that offer.
We are seeing some offer high, have the home not appraise and then they want to renegotiate rather than absorb the price difference. Some aren’t able to add the additional cash required to complete the loan with a less than purchase price appraisal and must ask the seller for a price concession. Cash buyers and buyers with a very large down payment can close escrow regardless of the results of the appraisal. Sometimes they will commit to doing so in their offer.
Treating everybody fairly is important. There are no guidelines for the selection process. All offers must be presented regardless of how they stack up in the agent’s mind. The presentation order can be in order of receipt, ascending/descending order of price, etc., but everyone gets presented. There are no selection requirements, the highest offer doesn’t have to be the one selected.
Offers should be considered in their entirety, i.e.- price, deposit, down payment, contingencies included, allocation of closing costs, timing for conditions and closing, etc. Some may include a free rentback or accept it as is with all the debris on the grounds, etc. Such considerations can be a separator between offers and make the difference for acceptance.
Timing can become an issue with multiple offers. The offer with a 15-day close of escrow and a 15-day rent back may appeal more than the offered 45-day closing without a rent back. Sometimes the longer escrow will appeal if the buyer is strong and the seller can rely on them closing. They have more time to pack and move. Seller motivation is very important, and your agent should work to find out as much as possible about the Seller’s circumstances so your offer can be customized to be most appealing to the seller.
Agents in a multiple offer situation have to be very careful. Every effort should be made to give all parties equal opportunity to buy the home. Sometimes agents will refrain from presentation of offers until a specific time and date to allow for all to see the property and write their offer. This doesn’t always work, however, as it is very nerve wracking for the sellers.
Instead of having many people in their home everyday and having to select from many offers, sometimes 20, 30, even 50, they want to accept a good offer and be done with that part of the selling process. They may leave money on the table, one never knows for sure, but now they can relax.
Don’t shy away from the multiple offer situation if you want to buy a house in 2021. Talk with your agent about how to make yourself look as strong as possible given your assets and circumstances. Make a clean, fair offer. Don’t get swept up in the “auction frenzy” of the multiple offer goings on, stay your course. Anything can happen along the way and you just might find yourself with an accepted offer on your terms.
An old Nevada adage, “You can’t win if you don’t play!” has never been more true in real estate than it is today. Get your bait in the water if you want to catch a fish, make your offer.
When it comes to choosing professionals to assist you with your Real Estate needs… Experience is Priceless!  Jim Valentine, RE/MAX Realty Affiliates, 775-781-3704 or dpwtigers@hotmail.com

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