How To Win in Multiple Offer Situations

You’ve found a home that you love, one you can picture yourself happily living in, only to find out that you’re not the only one who feels this way.

This is a super common scenario in the DC market and its a good idea to be prepared for competitive multiple offer situations. 

It is challenging to both love a home enough that you want to buy it, but also be prepared that you may not be able to do that. This can be a stressful and anxiety-provoking scenario, but we are here to help. We have successfully guided many clients through multiple offer situations and can work with you to create a strategy that you are comfortable with. 

Every situation is different and what is necessary to win in each neighborhood or market varies. In some neighborhoods it may be necessary to remove all contingencies from your offer, in others, that is entirely unnecessary. Knowing the terms that “winning” offers have had in other recent similar scenarios is important to your success.

Here are some of our top tips to consider when you find yourself in a potential multiple-offer situation:

 1. Remember your goals and top priorities. 

What is the budget that you are actually comfortable with? What are your dealbreakers? Does this home really truly fit what you are looking for and what you know in your heart is what you need to love where you live? Start by making sure this is a home that is worth competing for, and one that you are confident is a good fit for you. My rule of thumb in competitive situations -  if you’re not sure, it’s probably not the right one.

 2. What does the seller want?

I know this might seem one-sided, and that is because it is! The seller has all of the leverage in this situation. We start by having an in-depth conversation with the listing agent to find out what is most important to the seller, what particular terms are of highest priority. We can only give the seller what they want if we know what that is.\

 3. What level of risk are you comfortable with?

Sellers will be evaluating offers for price and the amount of risk that the offer terms present them with. To a seller, risk is pretty simple and is anything that could cost them more money or cause the sale not to go through. To you as a buyer, the primary risk is that you would not be able to fulfill the contract terms and that you could lose your deposit.

Specific things to consider as a buyer are:

• How confident are you that you can get a mortgage? If you are 100% sure, you may consider removing the financing contingency 
• Do you have extra cash to make up the difference between a low appraised value and a sales price? If not - you Could you pay the difference between the price you are offering and what similar homes have sold for?

While no real estate agent can guarantee your success in a multiple-offer situation, experience and market knowledge help to put you in the best possible position to succeed. We think its best to discuss the possibility of competitive offer scenarios in advance and determine if they are something that you want to consider. It is possible to avoid them, however, in some markets this will significantly reduce the available options.