Multiple Offer Strategies....when CASH is NOT always King!

Here in the Metro Phoenix AZ real estate market, or in this case Scottsdale AZ real estate market, it may not be Spring yet but the heat is definitely ON!

As soon as signs go up, and often before a listing even hits the MLS as active, prospective buyers are on their phones begging their agents to get the scoop. If the price is right....an agent can expect multiple offers to hit their email and fax within the first few days on market.

So....how does a financed owner occupied buyer prevail and beat out all those cash snowbirds and investors chomping at the bit for the next priceless pearl?

Write a letter.

Yep, that's what you should do. Write a letter. And try to meet the Seller so you can introduce your family and let them know how great their home is. Obviously, this strategy probably won't work with a Lender Owned or Foreclosed property listing, but it will with a short sale or traditional sale where there is a human being selling the home who has some emotional investment in the property.

Appeal to their emotions. Let them know how much you love their home and want to be a part of what once was their neighborhood. If it's a short sale, let them know you will wait out the negotiations and that you, too, are emotionally invested in their home.

Most distressed sellers don't want to leave.....but have exhausted all other options. They are often close friends with their neighbors and know that little Sally next door would love another 5 year old to play with, seeing as she won't be able to play with the Seller's little Joey anymore.

Now, it goes without saying that your offer will also need to be very competitive. I wrote a separate blog on that which you may reference here. Keep it clean: Don't ask for home warranties or seller concessions....put as much money down as you can, offer as much earnest up front as you can....reduce inspection periods, etc.

Don't think a letter will work? Think I'm full of hot air?

I just had a listing in Scottsdale accumulate 10 offers over a 3 day period on market. We listed aggressively at $169,990 (Wow, Sellers who took my advice, woo hoo!). We had several cash offers below, at, and above list price, up to $175k. We had finance offers up to $183k. So, which offer did the sellers take, you ask? Obviously the $175k 10 day quick close cash offer, right? Or maybe the $183k finance offer?

Eh. Wrong. The seller accepted neither of those offers. They went with the conventional offer for $179k. It was slightly lower than the other finance offer, but the buyers were putting 20% down and they MET THE SELLERS AND WROTE A LETTER. The sellers were sure of their decision, before we even sat down to thoroughly review and dig through the pile of offers. A few thousand dollars made little difference to them. Bottom line? They loved the buyers!

The old saying in sales is that people buy from people they like. Why should it be any different for a seller?