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Months of searching, attending open houses, and viewing available homes finally paid off. You’ve found the perfect property in the perfect neighborhood for the perfect price. You’re ready to make an offer. Then, it happens, you get the dreaded call from your agent telling you there are multiple offers on the property. How does that happen?
Reasons for Multiple Offers
Re-marketing. Remember, the listing agent has the legal and fiduciary duty to the seller to seek the highest price possible. Not only does the higher offer pay the agent more, but it also gives the seller more to work with. As the listing nears its expiration, the agent has an incentive to market it more aggressively so that they can earn their commission. That means more open house events, changes to the listing to bring it back into focus even if it’s been on the market for a while, and other marketing tools.
Inventory shifts continuously. That means at any given moment, fewer houses on the market puts the home you want on more buyers’ radars. Even a house they looked past a month ago might interest them today. This is especially true when you use narrow search parameters because everyone else using those parameters sees the exact same homes.
Buyer demographics align. If you chose to wait until the end of summer, or after the holidays for family reasons, the chances are high that a bunch of other folks did as well. If you’re an empty-nester and waited for fall to start looking, so did other buyers in similar life situations. They’ll like the same things about it that you like.
New listings. Buyers that have lost out to multiple offers in the past now know better than to “sleep on it” when they see a new house available that fits their needs. The typical multiple-offer scenario happens within the first two weeks of a listing reaching the market. This is true particularly if the home is priced right, has curb appeal and desired upgrades or renovations in a preferred neighborhood.
Pocket listings. A so-called “pocket listing” is when a seller’s agent knows a home is going on the market but is not yet listed, and it that appeals to certain buyers to whom they give the head’s up. Some pocket “buyers” ask for notification when there’s another offer. Since the listing agent represents this buyer, there’s nothing stopping their agent from helping them present a better offer than yours. Ask your agent to learn if the other offer is from a client of the listing agent since it makes a difference in how you craft a counteroffer. Options include increasing your offer, your agent could reduce their commission, closing without contingencies, etc.
Trust your agent’s advice on preparing a counteroffer and whether submitting a personal letter with the offer is a promising idea. In some cases, it’s about the bottom line; but in others, it’s an emotional decision to sell a home.