Lisa and Jim's Northern Nevada Real Estate Blog: There Is More Than Price In Evaluating An Offer

There Is More Than Price In Evaluating An Offer

Great Job Jimmy - You make some very valid points. 

Price is but one aspect of an offer.  Even if an offer is above the List price it might not be a good offer for the Seller.  If they've lived in their home for 20 years and the offer provides for moving in 15 days it is simply not practical even if you have a full price offer.  There are many components to an offer and each adds value to either the Buyer or Seller, depending on the item.  Price adjustments can and should be made accordingly.

A Buyer that works with a Seller on their move circumstances will separate himself from the rest of the pack.  Historically, the day escrow closed the Seller had to be out of the home.  This led to people hiring movers and moving out to the tune of $5,000 to $20,000.  Occasionally, the sale fell apart at the last minute - the Buyer bought a car and blew their ratios, a job transfer, etc.  If you allow a rent-back after the close for a week or two you will allow the Seller to have their proceeds check in the bank and move with confidence.  This can separate your offer from others.

Some Sellers may need money to move - a sizeable deposit released to the Seller after the transaction conditions are satisfied can help a Buyer negotiate price or stand out from the crowd in a competitive situation.  Taking a property "as is" can give both parties comfort - the Seller isn't worried about what repairs they will have to make that will diminish their proceeds, and the Buyer will know after inspections the condition of the home and can decide if the required repairs are commensurate with the price adjustment they negotiated. 

Escrow time frames can be used to your advantage, i.e.- shortening or extending times for moving or closing escrow.  We've had our offers selected over others because of a longer escrow - the Sellers were relieved to have the time to move.  Conversely, an all-cash offer and a 5 day close on a vacant house will appeal to that Seller over a 30 day loan-conditioned proposal. 

Consider the big perspective when you create your offer.  Besides price, important components include time, risk, labor, peace of mind, or ego.  We've had our offer selected over others by agreeing to include the family name in the subdivision process.  When you look at the property you are offering on, look for Seller motivation.  If they are already packing the house up a quick escrow is generally preferred.  If the property is inundated with tons of debris then the opposite is true. 

Don't submit your offer blindly - see how you can make the Buyer's motivation and the Seller's motivation converge for the perfect transaction. A contract that is a win/win for Buyer/Seller in most aspects will result in a healthy escrow with both parties committed to its success. 

Comment balloon 0 commentsLisa Wetzel • May 06 2009 10:32AM