From time to time, and more often in the current climate, you will find yourself in a multi-offer situation. Something most people like to avoid and not for the faint hearted.
In a high demand market like there is now it feels like every house you look at sees you pitched against other buyers. Recently, we heard of a property with 22 offers that sold over asking price so it has never been more important to put your best case forward.
It may not mean the highest price wins, it can be a combination of:
- how many finance days you have asked for
- The character of the person making the offer, they may only want to sell to families, or first home buyers rather than investors
- The number of days until you move in, settlement day
- How many other conditions you want eg, builder, lim
Should I give up and wait for the market to change?
Well that is an option but not really a sensible one. There could be a day when there are lots of properties for sale meaning less competition but heck how long can you wait, it could be years, meanwhile you have missed out on owning your own home and any rise in value. The longer you wait the harder it will be.
Okay, so what do I need to do?
Step one: do your homework on the property. Work with a buyers agent that will be able to find out the inside goss on how many potential buyers there are. If you are able to do all the background searches on the property such as LIM, and sometimes the vendor will have this available for you, then you will save yourself 10-15 days waiting for that, and one less condition on your offer. If you have a qualified builder that can inspect the property pre-offer this again can save you time and put you in a stronger position.
Work with your Nest Home Loans Advisor who can give you an online valuation report for the property showing an estimated market value and comparable sales from the area. It is all geared towards making an informed decision of what is reasonable so you offer enough to get accepted but don’t go too high that you are stretching yourself and overpaying for the property.
Step two: Review your unconditional down payment. We normally recommend a 5% down payment but in a multioffer situation a higher amount may help the vendor. If you have more funds then you can sometimes win on this alone if the vendor needs the money to put towards their next property.
Step three: Nest Home Loans can also review your sale & purchase clauses that affect finance to shorten your time frames and enable you to put forward the most competitive offer. This is about being organised and having great communication with your agent and mortgage adviser. Only Nest clients have access to the special clause that hands down wins multi offers. We try not to use the standard finance clause like other buyers, we work harder than that to give you the edge over others, and vendors love it.
Step four: Write a heartfelt letter so the vendor knows who you are. Some house sales are sentimental for vendors and you may only have one chance to get your point across. Don’t underestimate the power of human emotion.
And don’t give up, it can be tough getting knocked back but your dream home is out there. Following our tips will give you the best chance of getting an offer accepted.
Call us today or book a meeting to start preparing
Book a Meeting
Tineka Kavanagh
Mortgage Adviser
Phone: 027 650 4964
Email: [email protected]
