This article was originally published in Property Weekly print edition.
Doing your homework may help to improve your chances in a multi offer market, according to Greg Watson, Business Development Manager for Watson Integrity.
In the current hot market where demand is outstripping supply, some Palmerston North and Manawatū house hunters are left feeling frustrated and disappointed on being squeezed out, and in some cases repeatedly so.
But the anxiety level increases when buyers don’t understand the multi offer process, which is what can happen when a property is in high demand, and more than one buyer makes an offer.
If there is more than one offer in writing then the Agent must inform you that it is a multi offer situation.
“In this case the seller can choose the offer that works best for them, this doesn’t always mean the highest offer,” says Watson.
While it may feel like the odds are stacked against you in a multi-offer sale process, it's actually designed to give all potential buyers an equal shot.
“As a buyer in this situation it is important to put up your best offer first time as you may not get another chance at it.”
Watson says there are ways that buyers competing in the current market or in multi offer situations can help to improve their chances of securing a property.
“It can take a while to learn the state of the market when you’re looking to buy, so why not research what properties sell for that have similar criteria to what you’re looking for. Once a property is sold the price is considered public information. This means you can ring the real estate salesperson and they can tell you what the home sold for.”
Researching your property criteria as much as possible will help to determine what your best offer will be.
“You can also look at online portals like qv.co.nz or homes.co.nz to see recent sold prices,” says Watson.
“After doing this for a while you’ll have a good idea of what is being paid in market compared to the listing price and RV. This means when a great property comes along you’ll have the knowledge to increase your chances of being successful in a multi offer situation.”
Remember to talk to the agent to make sure you are clear about any deadlines and about the sale process as a whole. Communication is key.
“The real estate market continues to be hot in Palmerston North. This often results in multiple offers on properties. At present more often than not in fact,” says Watson Integrity Property Consultant Marcus Watson.
“A suggestion for buyers competing in multiple offer situations is that, if possible, if they can get into a position where they can make an unconditional offer than this can give them a much better chance of purchasing the property.”
Remember that the highest offer is not always the successful offer. An offer with a lower price but fewer conditions may be chosen over a higher price with more conditions.
You may wish to eliminate as many conditions as possible but make sure you are covering any areas of risk to you and exercise due diligence.
Again, the advice to buyers is to be prepared, do your homework.
Marcus says, “Making an unconditional offer is certainly not something to be done lightly and as a buyer you need to have all your ducks in a row to consider doing this. You need to have your finance all 100% approved by your bank, you also need to have checked the Council Records, have the Title checked over by your lawyer and have a builder view the home before your offer is made. All of these things can be done if you really wish to buy the house.”
“Certainly in a hot market an unconditional offer can be the difference between buying a home and missing out,” Marcus said.
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