Guest post by Sam DeBord, managing broker of Seattle Homes Group with Coldwell Banker Danforth.
In a limited inventory market, many of our professional conversations center on multiple-offers situations for sellers. There are plenty of courses and guides on how to position a home to receive the maximum return based on competitive offers, as well as how to present multiple offers to our sellers in an organized fashion.
There is very little literature, however, on effectively writing simultaneous offers for buyers. The practice of making simultaneous offers on multiple homes at the same time can be labor-intensive and isn’t appropriate in all situations, but it does provide some unique advantages to certain segments of our home-buying clients.
Investors are one set of buyers that can benefit greatly from the practice. They’re often looking for a certain style of home, in a certain price range, and hoping to purchase multiple homes within a short time frame.
Agents who represent buyers know that in competitive markets like we’re seeing today in many cities, each week’s listings are met with multiple buyer offers. Running clients around to see new homes every week, selecting one, and being outbid by other buyers can be a vicious cycle. For an investor who has a bit of latitude in terms of style and price, writing offers on multiple homes at the same time can create the opportunity to lock up a number of properties in a short timeframe, or—at the least—to improve the probability they will secure one property in a given week.
For the traditional home buyer looking for a primary residence, the tactics may require more research and some nimble paperwork. Buyers searching for their own home will usually be much more specific and critical about the home they’d like to buy. However, there are often those who are searching in a fairly homogenous neighborhood or development in which the majority of the homes are within their desired criteria. If you’ve already been through a number of unsuccessful bidding wars with them, they may be ready to start pursuing a more aggressive strategy with simultaneous offers.
To be clear, writing simultaneous offers should only be done when the buyer fully intends to buy any of the homes involved. This is a process that works within the professional standards of our industry when the buyers present a good-faith intent to buy—and don’t intend to fish for seller contracts only to decide later which ones were worthwhile. Buyers should be of the mindset that whichever seller signs the contract first, they’re going forward with the purchase of the specific home.
If and when that situation exists, home buyers can gain a significant advantage in a market that leans so heavily toward sellers. A typical showing schedule includes visiting the week’s new listings with our clients on Saturday and writing a single offer for their top choice on Monday or Tuesday when the sellers are reviewing offers. If, instead, we write offers on two or three homes during the weekend, we may be able to force a seller’s hand a bit.
There are a couple of distinct ways to present these offers. The first is more of a power play, which may or may not be to your advantage depending on the situation. If the home sellers in a neighborhood are regularly waiting to review offers until after the first weekend on the market (usually Monday or Tuesday at a specified time), you might submit multiple offers on Saturday. Let the sellers know your strong buyer has three offers on the table, and you’ll be pulling the other two offers as soon as one seller signs. It just might be the bold move to shift a bit of power back to your buyers.
The other option is less aggressive, yet still strategically significant. You can simply write three offers for three similarly-appealing homes and triple your clients’ probability of securing a home on any individual weekend. Given the amount of time, travel, and emotional effort buyers in these ultra-competitive markets go through on a weekly basis, the comfort of securing a home meeting most of their preferences may be more attractive than endlessly hoping for the perfect-home scenario that might never materialize.
I’ve personally handled these situations myself, as have agents on my team. It requires much more upfront discussion with clients as to the ramifications of each offer and the strategy for dealing with them upon having one accepted.
Out of respect for our industry associates and their clients, we should be prepared to immediately rescind any other open offers once our buyers have reached mutual acceptance on a home. Writing simultaneous offers might give us some leverage, but the goal isn’t to unduly burden sellers and listing agents with offers that won’t come to fruition. As long as unaccepted offers are pulled quickly and the sellers’ agents are informed in a timely manner, agents can create a strategic advantage for their buyers and still leave all of the sellers involved in a position to consider other offers. Based on the current market, they’ll likely have plenty of them.
Writing multiple offers for buyers isn’t always the right answer, but in some cases, it’s a very valuable tactic. Buyers aren’t the only ones who get burned out in this inventory-crunched market—our agents do, too. Getting buyers into contract and headed toward a successful closing often requires some creativity, coaching, and even extra paperwork. Writing simultaneous offers might just be the tactic that works for your clients and your agents.
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