Tips for winning Minneapolis real estate in a multiple offer situation
by Ben Ganje
on Wednesday, May 8th, 2013 at 8:55pm.
The Minneapolis real estate market is rapidly changing. We are nearly in the middle of 2013 with a supply of real estate inventory at record lows across most of the twin cities market. There are more Buyers out prowling the market than Sellers. Good properties priced right will naturally draw multiple offers from this real estate market scenario. Buyers looking for an edge need a seasoned realtor but also an edge to win out in multiple offers--here's our collection of sage advice.
Submit a Large Earnest Money Deposit.
Pending Minneapolis home sales have been known to fall apart. Many Sellers are worried that once they commit to an offer, the winning buyers might back out of the transaction or default on the contract after all the other buyers have disappeared. The earnest money deposit is part of your down payment. By increasing it above normal limits, you are showing the seller you are serious about closing. You're only offering the seller more money a little sooner than later, but it can speak volumes.
Show the Sellers You Are Qualified.
These days every multiple offer will be accompanied by a lender letter. To stand out, ask your lender for a loan preapproval letter, which is different than a prequalified letter. Being preapproved will make you a stronger buyer in the seller's eyes.
Shorten or Waive Some Contingencies.
Most Sellers will allow for inspections in a Minneapolis condo or home. We always recommend to get an inspection, but tighten the time period. If your loan is solid, waive the loan financing contingency.
Write Your Best Offer.
Don't hope for negotiation. We recommend offering your highest price right out of the gates. Make it attractive, maybe a bit above list price depending on the scenario and listing. Before making an offer price make sure you understand comps in and around the area--comps in the last 30-60 days are going to yield the most realistic values. Sometimes sellers deliberately set a price below comparable sales in an effort to generate multiple offers, so paying a little extra doesn't necessarily mean you are paying over market value.
Give the Sellers Time to Move.
Many Buyer clients we represent want to close in 30 days or less--this can be a sticky point. It's hard enough to juggle multiple closings if you are selling and buying simultaneously, and even more difficult if the sellers are doing the same. We recommend cutting Sellers some slack by giving them two to three days to move out after closing, without expecting compensation.
Mentally Be Prepared for a Counter Offer.
You can write the best offer, and a Sellers can agree to work with your offer, but at the end of the day the Seller still has the right to counter your offer. Understand all of the possibilities in that you may still be coming up from your offer price or terms. If the seller followed our advice on 7 Ways To Find The Best Real Estate Agent In Minneapolis, then it's a given that the seller will counter.
Prepare a cover letter to your offer.
This could perhaps be one of the most overlooked components in a successful offer. Sellers typically get offers without a letter describing the logic to which the offer was written. Because of this Sellers can merely look at the price, terms and become turned off--unwilling to even consider the offer. In every offer we write for Buyer clients we stress putting some emotion as well as a face with the name on the cover letter. This can go a long way describing the Buyer's situation or reasoning behind what they wrote.