Should Buyers Make Offers on Multiple Homes at Once?
July 8, 2016
Bidding wars are brewing across the country as a limited number of homes for sale has home buyers getting competitive. Indeed, 51 percent of nearly 800 real estate professionals with the Redfin brokerage reported multiple offers as the greatest challenge their home buyers faced in the second quarter.
Read more: Help Your Buyers Win a Bidding War
As such, more buyers are reportedly making offers on more than one house at a time to try to increase the odds of getting an offer accepted.
But some real estate professionals say that isn't a good strategy.
"I recommend that clients in this situation take a step back and consider what's most important to them in their next home and how far they're willing to go to get it," says James Gulden, a real estate professional with Redfin in Boston. "That way, they can be in the right mindset to make an offer they feel good about on a home they truly love when it hits the market."
Also, real estate professionals should coach their home sellers that the highest offer is not always the best offer. Sellers need to carefully review with their agents how committed a buyer seems to be about that house and how willing they are to close.
Nearly 40 percent of real estate agents recently surveyed say that the main reason purchase contracts fell through this spring was due to negative or surprising inspection results while 25 percent said buyers simply changed their mind about purchasing the home.
"It's not necessarily true that the inspection reveals major issues or that the buyers just got cold feet," says Jeremy Paul, a Redfin real estate professional in San Diego. "It's more that the buyers who are making multiple offers at prices they may not be able to afford just to get an offer accepted often use the inspection as a chance to negotiate significant credits in order to reduce costs. When the seller won't budge, the buyers move on."
Source: Redfin Research Center
Updated: June 17, 2019