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How to Pick the Best Offer in a Multiple-Offer Situation
Your agent can help you to figure out how to pick the best offer.
Helping the seller to pick the best offer is an important part of a listing agent’s job. Sometimes we have only one offer so it’s a no-brainer. Although, I will say we received a full-price offer on another listing recently when the seller snapped, “I’m not taking THAT.” What? Why not? Because the seller expected buyers to fight over her home and to offer more than list price. She just didn’t share those thoughts with me until we received an offer. It was our only offer, too.
The only thing we could do was take it off the market and put it back at a higher price. I didn’t want buyers to see we had raised the price, or they might not want to buy it. They might misjudge the situation and think the seller is crazy. I wanted a nice clean presentation at the higher price.
Now, obviously, when we receive multiple offers much of the time there might be that one particular offer that stands out from the rest of average offers. Sometimes, I might suggest the seller counter only one offer. Other times I might suggest we counter two or three, even offers we don’t want. We make the counters outrageous that if they did accept, we might reconsider.
But the problem that happens more often than not is we will receive two offers that are very similar to each other. They might even be for the exact price. Then what do you do? How do you pick the best offer? One method is to consider the qualifications of the borrower. For example, how much is the earnest money? Who is the mortgage lender? We usually lean toward local lenders, btw. A loan officer with a recognized track record and local appraisal management companies.
Yeah, so what happens if all of those things are equal? Maybe the net is identical to the seller. Both buyers very strong, qualified, committed. What can make the difference then? In my experience, it boils down to the buyer’s agent. Who is the buyer’s agent? Is that agent difficult or cooperative? After all, we need to count on the buyer’s agent to educate the buyer throughout the process and manage her or his side of the transaction.
We are often in daily contact with the agent. Is the agent responsive? Quick to communicate? Professional? The agent can make or break the buyer’s chances of winning a multiple offer situation. One of the last determining factors when considering how to pick the best offer is deciding on which agent we want to be in escrow with. While Sacramento listing agents don’t pick the best offer themselves, we do help the seller to choose.
So buyer’s agents should think about whether it is really wise to be argumentative off the bat. How being pushy and aggressive is not the way to best represent their buyer. I’ve watched more than one deserving buyer lose the house because of their agent’s lousy attitude.
Perseverance Means No Cricket Sounds Allowed in Sacramento Real Estate
No Sacramento Realtor wants to hear cricket sounds when calling a mortgage lender.
Mortgage lenders in Sacramento are a crucial element to a transaction but they can also be a total bear to deal with. That’s because they tend to either over communicate or under communicate. Now, I suppose they can say the same thing about many Sacramento Realtors, and that might hold some truth as well, but I suspect agents are more likely just not to communicate at all than communicate too much. Cricket sounds are common.
Seems lately either I can’t get mortgage lenders to stop sending me all of their spammy emails or they simply ignore urgent questions. It’s one irritant or the other. Some guy called last week to say he noticed I am closing a lot of sales, so he must have just gotten his license. He wanted to know if I could meet with him because he believes he should acquire more friends. Bully for him. No. Then he asked if he could buy me coffee. No, again. He didn’t have a script for what happens when his target just says no. Not gonna happen, guy.
Dude, I flaked is the usual excuse in Sacramento real estate. Agents drop out of sight, stop communicating on a whim, and when they do pop back into the picture, it’s sorry, I was out of town for several days or wherever. Maybe I’m a bit jealous that I can’t just vanish and skip out of town for a weekend, leaving all of my business hanging, because I’m too damned conscientious. I couldn’t do that to people.
Like the other day I needed an update on a loan to keep my seller from teetering on the brink of insanity due to cricket sounds from the buyer’s lender. The poor buyer’s agent had called the mortgage lender over and over, no response. The buyer’s agent had texted, left voice mails, nuttin’, just crickets. So I thought, well, I’ll give it a shot. I called the phone number, which seemed to be the main line to this particular business, but the phone rang and rang. Then it abruptly disconnected. Cricket sounds.
I sent an email. No response. I called again and this time got dumped into voice mail, so I left an urgent message. Hey, bet this company has a website. I clicked on the page and it bought up names and phone numbers of other people who work at that company. I started calling them one by one, voice mail, voice mail, voice mail and then voila, a person answered. I shared my dilemma that the mortgage lender has not called the buyer’s agent despite repeated attempts, and I couldn’t seem to get through, either. I asked if there was some magical way I could talk to this individual.
Three minutes later, the lender was on the line. See, I have learned to never give up. Perseverance. There is always a way to accomplish your goal. I’ve never been one of those people who says, well, I called but nobody answered. That’s a loser excuse. I stay on it until I get a response. If you’re on the other side of this, you do NOT want Elizabeth Weintraub on a mission. You do NOT want to give a Realtor who thrives on challenges this task. Just return my call is all I ask. Cricket sounds are unacceptable.
Dealing With Unreasonable Buyers After a Home Inspection
A home inspection is only for a buyer’s edification and not a license to ask for repairs after a home inspection, but what do buyers know? When it comes to advising clients in a real estate transaction, this Sacramento real estate agent is direct with her advice. There is no skirting around the issue. I try to present a balanced picture for clients, pros and cons of actions they could take or ignore, especially when it comes to the dreaded Request for Repairs, which are often a buyer’s response to a home inspection. I wish often that agents would provide a better education for their clients, but then that would involve recommending top-notch home inspectors at all times, and that’s just not a reality.
Sometimes, the buyers don’t want to hire the agent’s home inspector because they don’t trust their agent. Which is always a lovely situation. They might think their agent is likely to recommend some doofus home inspector who won’t do a thorough job or who will gloss over some stupid repair, which is idiotic thinking, but what are ya gonna do? You can’t easily change how a stubborn person thinks, especially if they won’t listen. Therefore, often what perpetrates a problematic request for repair is a home inspector’s bad home inspection report.
It’s not bad in the way that a buyer would think in that a home inspector was covering up an issue. To start with, home inspectors don’t cover up issues. They expose issues. The main problems are some that home inspectors expose issues that don’t exist or insist that items are broken / need repair when said whatchamacallits are perfectly fine.
One can also throw into that mix an agent who whips out a pad and starts writing down all of the buyer’s concerns without so much as lifting the pen from the page or discussing them. Being an order taker is not what a buyer’s agent is all about. I would shrivel up and die if I presented a Request for Repair to a listing agent like some of the documents I receive. Some of the requests are just a list of every defect from the home inspection. What that tells me is the buyer’s agent either has absolutely no guts or else no clue — either way it’s bad. Sometimes agents behave like they are order takers and not real estate agents.
Maybe they’re simply exhausted and worn down by the buyer? That can happen. But then the rest of us are stuck with explaining why the home inspector was wrong in the report and why we can’t perform the repair requested. Besides, sellers are not required to fix anything the buyer complains about. Every home in California is sold AS IS. But most sellers want the buyers happy with their new home, so we try to find a way to keep everybody on the path to closing.
I just wish buyers would select one or two major issues like most sensible buyers would do. But then, this is Sacramento real estate wherein expecting things to make sense could render one a crazy person. You know the definition of insanity, right?
The Consequences When Buyers Write Multiple Offers
When sellers discover that a buyer’s agent had allegedly written multiple offers for Sacramento home buyers — both of which were accepted — it can be normal for sellers to want to express outrage and direct those feelings toward the buyers. Because the buyers should not play games, the sellers might say. The sellers might feel deceived, believe the buyers are dishonest, when all the buyers are really doing is following the ill advice of their buyer’s agent.
Some brokerages in Sacramento recommend this practice, I hear. I can’t believe that any reputable real estate brokerage would advise their agents to write multiple offers for buyers but I don’t know what goes on inside every brokerage in town. I know what Lyon Real Estate lawyers advise, and that is: don’t write multiple offers. They say there is a good faith covenant inherent in the residential purchase agreement that could be breached if a buyer can’t afford to own both homes and tries to simultaneously purchase.
Now, if a buyer came to me and said, for example, that the wife wants to buy one home but the husband has his eyes on another home, I would never in a million years tell those buyers to write offers on both homes and then decide later. Yet, that is what can happen in Sacramento. Nope, I would say go home and sleep on it and if you lose both homes because somebody else steps in while you’re deciding, that’s the way life is. Or, write an offer on the home you like best right now.
But that’s just how this Sacramento real estate agent operates. I try to give my sellers the best advice available and, at my age and experience level, I better be right. My reputation and credibility are at stake, not to mention, buyers who write multiple offers could get sued by an irate and damaged seller. It will happen someday. Mark my words, and then buyers will be crying at their agent and asking why, why did you tell me to do this?
Hope the agent’s E&O is paid up.
Do Sacramento Buyer’s Agents Push Up Home Values?
Here is a new dig about real estate agents that I haven’t heard before. A potential seller of a home in Land Park called to talk about her overpriced home and how it got that way. During the conversation about how and why she paid too much for it — which I’ll get to another day in another blog — she mentioned that she was trying to buy a home in East Bay. When I mentioned I have a close friend who works in her targeted city and she might want to contact that agent to see homes, the caller threw out this crazy idea.
What I believe she was saying is that she doesn’t trust real estate agents, which is too bad. Because there are many excellent real estate agents in the business, and not every agent should be painted with the same tainted brush due to a few bad apples. This home buyer was reluctant to work with a Sacramento buyer’s agent who is a neighborhood specialist, i.e. an agent who works and lives in the neighborhood. Her feeling was the agent would try to drive up prices in the neighborhood by making her pay more for a home.
In other words, she believed the agent would not in good faith negotiate on her behalf in order to make the agent’s own home worth more. What? First, I told her, understand that agents are highly unlikely to try to push her to pay more to increase an agent’s own home value because they’re just not that diabolical. Second, comparable sales are good for only 3 months and unless a person is selling her home within that 3-month period, that sale won’t matter one little bit. A home that sold last year has no bearing on home values this year. Not to mention, one home sale does not increase the value in any given neighborhood.
What buyer’s agents want first and foremost is to make their buyers happy. They want satisfied buyers, buyers who are thrilled with the purchase of their new home and with the agent’s performance. Also, because they are home buyers who someday will be a seller, and the agent wants to eventually list the home as well. Agents want clients for life.
Buyer’s agents who are REALTORS have a fiduciary to the buyer and must hold that buyer’s interests above their own. Not only that, but Sacramento buyer’s agents want to get paid. They want to close the transaction but not at all costs. They are more focused on bringing together a buyer and seller on price than on manipulation of said price. A Sacramento buyer’s agent will do everything in her power to represent the buyer to her fullest and best abilities. Moreover, that neighborhood specialist will probably know more about the neighborhood than an out-of-area agent, which would be to her advantage!
A client called a few days ago to ask if I remembered her. I recognized her voice immediately. I also have Caller ID (ha, ha). She bought a bank-owned home in College Greens 5 years ago, and today it is worth considerably more than she paid for it. Location is everything, I reminded her. She bought in an excellent neighborhood and on a highly desirable street. She was just calling to say thanks for the holiday card. It was delightful to chat with her.
That’s the kind of happy buyer I want. It’s the kind of happy buyer just about every Sacramento real estate agent is after.
