I spent the last week fielding multiple offers for a house I listed in Agoura Hills. It was a remodeled single family home under $700,000 which made it the lowest priced single family home in Agoura Hills. No surprise there was a ton of interest.
We received 9 offers within a couple days.
As I was evaluating each offer, I was thinking about how many other variables come into the equation when deciding which offer to take and which offers to avoid in multiple offer situations.
With all things being equal (or close to equal), it often comes down to the agent and how the offer is presented. While you may think this is unfair or shouldn’t matter, the truth is – it does.
Agents That Reduce Your Chances of Getting Accepted
The Out-of-Area Agent – I received calls from agents all over Southern California from San Bernadino to Valencia to Santa Barbara. Out-of-area agents aren’t members of our local MLS so they don’t have access to all the relevant info. Out-of-area agents don’t know the nuances or our market. Out-of-area agents don’t know the local requirements of our cities and counties. Plus, this is a relationship business. Who has the advantage, the agent I know personally and worked with over the years or a stranger from out of town?
The Discount Agent – A discount agent is typically inexperienced and/or unable to make it on their own so they work for a discount broker who sends them clients. The discount buyer is someone who is looking for a commission kickback and is willing to work with a less skilled agent mistakenly thinking they will be saving money. The truth is that both the buyer and the agent are at a disadvantage when competing with a traditional agent. That’s just reality.
The New Agent – We all start out new at one point and it’s tough, but experience matters. A new agent will often be out maneuvered by a competing veteran who’s been through the multiple offer situation many times.
Pro Tip: Find your agent on Zillow. Read the reviews, find out how long they’ve been in the business, view their recent sales to see what areas they work.
The Part Time Agent – Being a real estate agent is not a hobby. I’ll just leave it at that.
The Lender Agent – You’re either a lender or an agent. You can’t do both effectively. Whenever we see an offer from “John Smith Financial Services” we know it’s going to be a challenge. See “Part Time Agent”.
The Pushy Agent – If your agent is too aggressive and pushy, you’re doomed. I had one agent put a very short deadline on the offer to try to push the seller to accept right away. It wasn’t a strong offer so I just ignored the deadline. Of course he called letting me know they were willing to extend the deadline (no surprise) then tried to push for a quick response again. His offer wasn’t great and he was pushy & annoying. Do I want to work with this guy for the next 45 days? Not a good strategy to get acceptance.
Other Factors That Screw Up Your Offer
Low-balling – Agents who know the area typically have a good idea of what will be a hot listing and what won’t, yet I’ll still get a low-ball offer on a brand new listing that everyone knows will sell quickly. You might think, hey it’s worth trying, but it’s really not. It’s often the buyer who comes in early with the strongest terms that wins. The seller wants to know you love the house and are excited about it vs. trying to get a steal.
Submitting an offer with mistakes – When I’m evaluating an offer, I’m evaluating way more than just the buyer. I’m also evaluating your agent. If there are mistakes, missed checkboxes, items not filled out, etc, that puts up a red flag. We will be working hard together for the next 30-45 days. I want to work with a pro who takes the time to do things right. If I see mistakes in the offer, chances are there will be mistakes throughout the escrow process.
Getting cute with the offer – It surprises me when I see agents try to slip something by like having the seller pay for things that are customarily paid by the buyer. All this means to me is that I now have to add more terms to the counteroffer removing those items from the transaction. It just creates more work and erodes the trust that we should be building at that stage. Make sure your offer is clean and if anything, do the opposite – have the buyer pay for some items normally paid for by the seller. That will help your offer stand out and make us all like you!
And The Winner Is…
Back to the Agoura Hills house, the offer that ended up winning beat out 2 all cash offers, several offers with larger down payments, and one that offered a slightly higher price. And it was contingent on selling their current home that was in escrow! How did they win? They waived the appraisal contingency which was huge, their lender called me (who I already knew) and convinced me they were solid. Their agent was local and responded to everything very quickly, and overall we just got the vibe they wanted it the most.
