Multiple offers from a home seller’s POV
If you haven’t sold your home recently, you might be interested to hear a bit about what that experience is like in the current Seattle market.
Once a home has been prepped for sale — which takes very little work in such a strong seller’s market — the agent and homeowner agree on a list price based on sales of comparable properties. This is easier said than done when homes are selling so quickly at ever-escalating prices.
If the agent and seller anticipate multiple offers, they often set an offer review date. That date is usually 5-7 days after the home goes on the market. This strategy typically nets a higher sale price for the seller than if they accept the first offer that comes in.
Appropriately priced homes in West Seattle currently receive anywhere from 3 to 15 offers that meet or exceed the list price and are not contingent on inspection. I.e., buyers have either pre-inspected the property or waived inspection. This essentially results in “As Is” sales.
It is not unusual to receive all-cash offers and/or offers with down payments of 30-50%.
The agent then prepares an analysis of all the offers to determine which are the strongest.You may be surprised to hear that the highest offer price doesn’t always constitute the strongest offer.
Each agent goes about this analysis in their own way. My process consists of creating a spreadsheet showing a side-by-side comparison of the offers on 24 separate criteria!
A “strong” offer is one that has the best chance of closing quickly and without incident. For instance, if there is a loan involved, the lender should have a good track record for closing on time. The chosen offer will typically have a combination of a high purchase price, reliable financing, and a contract with few, if any, contingencies (i.e. “outs” for the buyer).
The seller also wants to ensure that the buyer will go through with the purchase even if the house does not appraise for the full amount of the offer price. This means that the buyer has the financial means to pay the difference between the appraised value and the offer price, in cash.
Once buyers and sellers have reached Mutual Acceptance — and disappointed the 2 to 14 other buyers — the sale will usually close in 30-45 days when a loan is involved, or as quickly as one week for an all cash sale.
After that, the seller often gets to experience the process in reverse, which is why many homeowners are reluctant to sell.
Any questions? Comments?
If you are ready to buy or sell, give me a call at 206-708-9800