Not much confuses the bejeezus out of first home buyers like the dreaded multiple offer situation. If you’re reading this you might be a participant of one right now or know someone who is.
Check out my Multiple Offer Situation FAQ and tips for the frustrated buyer.
You’ve found the home of your dreams, made an offer….. and the agent tells you other offers are expected in.
You vaguely register that the house you’re keen on is popular as hell – which should be confirmation of your fabulous eye for hot property but waiting is not your gig and the stress of the unknown is making you feel slightly ill.
You’re probably wondering…
How long will I have to wait?
Ask. It’s unlikely that the agent will be able to give you an exact deadline on the spot as they will need to ask their seller how they would like to proceed. But as soon as they have, the agent should let you know when your offer, and any others, will be presented.
While you wait why not request a copy of the agencies Multiple Offer Procedures to help familiarise yourself with the process (it should resemble this)? Or take advantage of your head start and get stuck into your homework on the property. *Shortening and eliminating conditions can give you a real edge.
*Stay safe by running your plans past your solicitor.
There are no other offers yet.
….is making me wait even legal?!
Agents are required to make the seller aware of matters relevant to them in a timely manner – naturally, this would include the presence of your offer. (Rule 9.1 and 9.3 – Code of Conduct – view here)
But ultimately the seller decides when they are happy to consider offers. As long as the seller has been consulted by the agent and their decision has been conveyed back to you there’s nothing untoward happening here.
You are entitled to be treated fairly by the agent (Rule 6.2) so, while a short wait is often just the name of the game, you can expect communication around timeframes etc.
Is other interest real?
Or are they stalling..
Most buyers are concerned about paying too much and, naturally, most sellers are concerned about accepting too little. Accepting an offer right before a better one comes in is every sellers fear.
When the first offer is tabled a seller will often instruct their agent to go back to other parties who have expressed strong interest and give them an opportunity to also have an offer considered. If you’ve been told there is other interest, there likely is. The seller is taking a moment to establish how much and how serious.
Waiting can be rough but understanding what is going on can lessen your anxiety so, if you haven’t been offered adequate information, don’t hesitate to ask for more.
Seen the property in its first couple days on the market?
It is also quite likely that the sellers will be nervous about accepting an offer before their first weekend of Open Homes so may want to hold off making any decisions until getting a few more buyers through.
I’m the first offer…
…do I put my best offer forward now or wait until there’s another on the table?
Exactly how big does this carrot need to be?
Wait. It’s easier to go up than down.
You should only be asked to make your highest and best offer when the second offer is on paper.
If you decide to go to your max early and no other offers eventuate the agent should inform you, giving you an opportunity to revise your offer prior to presentation. This is also the case if you aren’t the first offer but all other offers are withdrawn before presentation.
Be aware that the agents legal obligation (fiduciary duty) to the seller does not allow them to withhold information relevant to their interests and, you guessed it, that includes the level of your original offer.
Aside from waiting…are there any other options?
If you are the first offer, make it a show stopper.
Go to your limit – subject to the seller not calling all interest. Worst case scenario you find out what won’t buy it (on the day you make the offer) and have the opportunity to reassess your position.
And if your offer isn’t accepted don’t let that scare you off entirely. You can always have it resubmitted with the other offers. You may find that what wasn’t good enough on Friday is all of a sudden acceptable on Monday once the seller has a clearer picture of where the market sees value.
Put a Sunset Clause in your offer.
A Sunset Clause gives your offer an expiry date. I would suggest using these selectively. Unless you have a very good explanation for using one (cue Leaving On A Jet Plane) or your offer is an absolute show stopper, sunset clauses can backfire and be viewed as a rude (and ineffective) attempt to strong arm.
Withdraw your offer.
Until your offer has been accepted you can withdraw your offer at any time. You can withdraw verbally but I would suggest you also follow up with a txt or email.
Never. Ever. Ever…
…knock on the sellers’ door and try to engage them directly because you’re sick of waiting.
Why? Not because you’d be stepping on the agents’ toes (but, yes, there is also that) but because you would be disrespecting the sellers chosen process which is more likely than not to be unproductive.
Hand on my heart, unless there is an extremely good reason – like the agent has been abducted by aliens and you personally witnessed said abduction or you can’t reach them despite repeated attempts over a reasonable period of time – this is likely to have the exact opposite effect of what you are hoping to achieve.
What to do when there is radio silence…
I have read comments online from buyers who have simply been really unhappy with the frequency and quality of communication they receive from the real estate agents they were dealing with.
You just want to know what’s going on. I get it.
If you find yourself in this situation I suggest you email the agent in question, address your areas of concern and copy in their Branch Manager (have a look at the website for the relevant office – you’ll be able to track the Branch Manager down there).
If this has happened to you, I’m sorry – on our collective behalf. Agents slip up. We’re human too. But, when warranted, the above is likely to quickly get things back on track and improve your overall experience.
Good luck with your offer!
PS. Is there something I haven’t covered off here? Fire away in the comments or send me an email here.
If you are looking at selling property in the greater Auckland region I may be able to help. Give me a call to discuss your requirements on 021 454694 or email me here.
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