This project was a study in:
- Exercising restraint until the "right" time
- The importance of pre-inspection
- The importance of great staging
- The importance of great photography
- The importance of my getting in front of the buyer when possible to establish trust (for them) and to see first-hand their motivation (for my clients)
- Picking the right Buyer's Agent
This project was at first interesting in that we could have listed it for sale a month or so before we did. The owners had the ability to hold it until the right time, though, so we used that to our advantage and used the extra time to button up maintenance items that came out of the pre-inspection, get the home staged and then adjust the staging, have good photographs taken and then take a few more. The Sellers were not excited about the items that came up on pre-inspection (before listing) but having the inspection proved to be of great value. Not only were they able to get some maintenance items out of the way that buyers would have seen as important, but they were able to demonstrate to buyers that they knew the condition of the home (very good over-all) and had priced it with full knowledge.
The staging was good when first installed, but we made some tweaks to it before photography. One challenge with stagers is that they often use what they have. The Sellers and I felt that this home needed a “significant” dining room table in order to fit with the architectural design of the home, and also to show that home as one that would accommodate a family. We knew we were fighting a bit of a battle on this one, as many young families prefer at least three bedrooms on one level (one for the parents and the others for kids) and the house simply didn’t offer that.
Once the staging was perfect, we shot good photographs in good weather. There were a few angles that we then thought should be re-shot, so we did. It was nice to have the time to merchandize and market correctly. We held a few open houses, and everyone in the neighborhood showed up. I was personally able to spend a few moments with one of the eventual Buyers; this was important – I believe – as he needed to trust me later in order to get across the line.
On offer review day, the importance of the pre-inspection was reinforced when I had a prospective buyer ask me to see the report and then made an offer not subject to inspection based upon what they saw. More offers normally means a higher price, and this case was no different. We had a priced at a number that the Sellers would have been happy with, but were able to push that number, and our confidence in closing at that number. The Sellers chose the offer they wanted to work with, and we were able to make it better by having the buyer’s agent ask her clients if they would waive their financing protections. They did.
When we met the appraiser, we were sure to show the appraiser all of our offers, and to indicate how completely the Buyers wanted this house. The appraisal came in “at value,” the Buyers arrived in town and all were happy.
View listing details here.
I get this question a lot. My observations: the best opportunity often seems to come when the property has been on a while at the current price. When the Seller drops the price, they are likely to dig in at the new number, and less likely to take a lower offer before giving it some time. If they manage price drops correctly, they can always keep the pressure up.
I just had another client ask me whether he should make an offer on a property he likes…Buyers typically ask this if they are worried about getting emotionally committed to a home and then not getting it; normally by being "beaten" out by other Buyers. Every case is different, but generally…make the offer. Unless you are so battle-worn that you just can't take it anymore…dust your shoulders off and get back in there. You can't win if you don't play. Better to play and lose than to not play and see someone else win a game that you could have won.
I recently had the opportunity to share some thoughts on the use of a “Buyer’s Sale of Property” contingency for a home they like. They like the home, but are concerned that they have less price leverage with that contingency included. Here’s what I told them:
It is true that a Buyer conceivably have less negotiating power when making a contingent offer, but sometimes the Seller has a bottom line that ignores that element; that is, their opinion of value is not tied to a contingent v. a non-contingent sale.
It is also true that it is relatively unique for a Buyer to find a situation in which a) they like a home and b) the Seller is in a position where they might seriously consider a contingent offer on that home.
It is also relevant to those Buyers who might make a contingent offer that if such an offer is accepted and goes through to close, it will likely help the Buyer avoid the “two moves” situation that selling first and then buying often requires. That avoidance can save real out-of-pocket dollars (movers, storage, short-term or broken leases) and allow the Buyers to avoid sometimes costly disruption to their lives and careers.