Picture this, a home hits the market and the agent is holding off on offers to a Sunday at 6 hoping to create a bidding contest. Within 24 hours a “bully offer” was submitted on the property. (Bully offers are offers where a Buyer submits an offer before the presentation date hoping to get in front of any other Buyers. The offer was not accepted and the Seller decided to hold off to the agreed upon offer date. On Sunday we submitted an offer on behalf of a Buyer along with a letter explaining the situation of the Buyer. In the end there were 8 offers including ours and our Buyer was successful.

If you are thinking this is a story from the boom times in 2022, you might be surprised that this happened this past week. Bidding wars are happening on a regular basis with 17 out of 41 total sales in the last week selling for over asking price. The hacks are written to help educate Buyers, however they are written as if to advise the agents representing the Buyer/reader.

Here are some hacks on why some offers are accepted and 5 reason why some are not.

1. Timing. If a Seller advertises that offers will be reviewed at 6 pm,  send a notification to the listing agent that you have an offer. Wait until just before the presentation time to submit your offer. The reason you do this is to created a winning strategy. If there are no competing offers your offering price will be different than if you are competing with 7 other offers.
2. Deposit. All offers need a deposit to secure the contract and offers always looks more serious when they are accompanied with a large deposit. It is always beneficial to take a picture of the deposit and include this with the offer so the Seller knows the offer is a serious one..
3. Price. There are a couple of thoughts on the topic of price. First, when your agents submits an offer make certain that you choose an odd number. Meaning, if you are offering $850,000 make the price $853,000. I have seen it happen many times where the top two offers are the same price and if one is just a few thousand dollars more, the Seller may go ahead and accept the slightly higher offer. Secondly, have your agent determine what the top price you are prepared to offer before you submit the offer. This way it takes away the chance to make an emotional decision and pay over what you felt was fair.
4. Conditions. All Sellers want a firm offer, however, if you need a condition such as a financing condition, include a pre-approval to show the Buyer has already been cleared by a lender.
5. Relationship with Agent/Seller. It is always best if your agent is friendly with the listing  agent. Home sales come together when done in a friendly and professional manner.

5 Ways to ensure your offer has little chance of being accepted.

1. Availability. When you make an offer be available. I have had many occasions where an agent brings an offer and we have questions about the Buyer and in turn the agent informs us their Buyer has disappeared and they cannot be contacted. Most offers are wrapped up within a few hours so be available.
2. Don’t assume you will get a second chance. When a Buyer submits an offer and is prepared to pay more than they first offered, I have seen many times where the Seller goes ahead and accepts an offer without giving any of the competing offers an opportunity to increase their price.
3. Closing dates. If the Seller is asking for a 60 day closing date, don’t offer 120 or 30. Many offers are considered not workable when an impossible closing date is offered.
4. Clauses and inclusions. If the Seller indicated they want to keep the hot tub, leave it out of the offer. Including items that are specifically excluded is a way to lose the interest of a Seller. Also created the cleanest offer possible. I recently had an offer come in from a Buyer agent on a high rise condo with a clause in the contract discussing the legality of a basement apartment. Clean offers are strong offers.
5. Don’t be aggressive with the listing agent. During negotiations it can happen where emotions run high. When one party becomes aggressive, the chances of an offer becoming accepted is limited.

In the past week  Oshawa had 25% of all properties sell for full price or over asking indicating that the bidding wars are still ongoing. I find the best solution to become successful as a Buyer in a bidding contest is to work with an agent who is experienced in multiple offer situations and has a good track record of winning.

If you are interested in exploring buying a property or selling and creating a bidding contest environment, I can be reached at lindsay@buyselllove.ca or 905-743-5555

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