Lately, it’s
not uncommon to see multiple offers, especially on homes listed below
$250,000. In fact, over half of the
homes I’ve listed this year had multiple offers within three days.
It’s
important to remind readers that when I work for a buyer, I work for a
buyer. And that means we focus on
finding value, making sure we know everything we can about a home and a
neighborhood, and making the most logical decision we can based on the data.
When I work
for a seller, however, I work for a seller.
And that means my job is to get my seller the very best offer possible from the best qualified buyer.
So the
methodologies are different, very different, when working with buyers and
sellers.
With buyers,
the goal is to stay out of multiple offer shootouts. With sellers, oftentimes the goal is to
encourage multiple offer outcomes.
Having said
that, one of the strategies I have employed successfully in this sellers’
market is what I call “Frankenstein offers”.
This simply
means that when I am representing a seller and we have multiple offers, often
we will take the best components (price, closing date, earnest money,
contingency dates, etc) of several offers and create one master “reverse”
offer, which gives the seller everything he is asking for in one shot.
We then rank
the quality of buyers, based on strength of down payment, qualifications, and
yes, who their agent is (with a strong preference for agents in the top 20% of
our market).
The
resulting “Frankenstein offer” is then presented to our preferred buyer, with a
relatively short deadline for acceptance.
If the first buyer fails to perform, we move to buyer number two, and so
on.
Now of
course there are some strong caveats around this.
First, you
cannot overplay your hand. You must be
reasonable in what you present to a buyer, or your arrogance will blow the deal
entirely. You must be respectful and
committed to making sure the buyer still feels value in the proposed terms that
you lay out.
You also
have to have a saleable piece of real estate.
My
“Frankenstein offers” this year have all resulted from properties that were
turnkey ready and priced to sell in today’s market. If you list a $250,000 home for $290,000,
this post is not for you.
What we’re
talking about are well-maintained or renovated homes in turnkey condition with
a reasonable starting price. That kind of home will most often have a shelf life measured in hours or days, not weeks or months…
and that’s what you need in order to succcesfully “Frankenstein” an offer.
In a hot
market, selling a home is much easier than it has been in past years.
But let’s be
clear… if you’re a seller, merely selling your home should not be your ultimate goal. Your primary objective should be
to market and negotiate your way into the highest possible net dollars after
closing. That's what matters most, and that's why quality agents are never at a loss for new business.
