This is part 2 of the interview with a Denver real estate seller’s agent who provides more valuable insider tips for sellers. See part 1 here.
How did this seller end up with two offers on his property both $10,000 over asking price? Multiple offers are generated by preparing and pricing the property correctly for the current market.
In this 6-minute podcast, seller agent Todd explains to his seller how to pick the best offer when two or more are presented. He explains that sellers do not have to take the very first offer they are presented with. In fact, Todd recommends the seller set a time period (which usually extends for around 5 days) during which they can take multiple offers.
This outstanding seller’s agent says he goes over the pros and cons of each offer with his seller, and reminds his seller that this is a negotiation period. He explains that “until you sign, you are not under contract”. Here’s where the seller’s agent expertise in negotiation really starts to shine through!
So how did Todd get these buyers to go above their initial offer and play one against the other? First, it depends on whether the best offer is above or below the asking price. These scenarios constitute totally different strategies!
Todd explains that he helps his seller evaluate which is the best offer. Different strategies are employed whether offers are above or below asking price. If above, Todd goes to the buyer’s agent of the other offer and sees if they are willing or able to go higher. If the best offer is under the asking price, he may just tell the other buyers agent that “we have a strong offer”. If the offers are well below the asking price, Todd claims that “we don’t want to show our hand”, and so may say very little other than that there is another offer being considered.
Jeff the seller asks about lender letters and how the seller agent evaluates those. Todd explains that the lenders are only allowed to say what their buyers give them consent to say, but sometimes they will say “this buyer is qualified for X dollars, but they could afford more”. Todd likes to always talk directly with the lender to find out what he can about the buyer’s financial capabilities. He claims that some buyer’s agents will be proactive for their clients and will call him to explain that their buyer is well qualified to back up their bid. They may express that their buyer has solid lender approval. These assurances may make the seller more willing to accept this offer over others where they do not have these assurances.