We are seeing an increase in our sales volume as well as number of sales over the first quarter of 2013.
Additionally, agents that have been in the real estate business for less than 5 years are experiencing the multiple offer situations that have not been prevalent over the last 5-6 years. Its a whole new learning curve for them.
Here are a couple of things that I feel need to be addressed with the public as well as the newer agents in our sales and marketing areas.
#1. Many news reports boast of huge gains in prices of residential homes. Those are national statistics. Places that are major metropolitan areas like Charlotte, NC or Atlanta, Ga. are showing larger gains than our coastal areas and small town America. Sellers need to understand that it is still a factor of supply and demand. It is still a factor of "what a family can afford". Our interest rates are wonderful and open the door for many first time home owners to qualify. However, the lenders are much more strict on the ratios, source of funding, loan to value, and even the actual colateral itself. If your roof is older and will need replacing soon, you may be turned down without a new roof. If you do not have enough established credit or if you have several late pays over the past 12 months, you may not qualify. If we have learned anything over the past few months, it is that your sale is not a done deal until it is closed and recorded! We have seen deals fall apart after full loan approval. We used to be able to count on the deal closing once the last hurdle was passed and the appraisal had been done. That is no longer the case. On more than one occassion, the underwriter turned down the loan in the last week before closing. Moral of the story: don't let your Seller move out of the town until the transaction is closed.
#2. If you are a potential buyer and feel the property is a "good deal", you better assume that someone else feels the same way and offer your highest and best price and terms. Too many buyers are under the impression that they can make low offers and "steal" a property. The truth is, that if more than one offer comes in , even your full price offer may not buy the property for you.
#3 Properly handling the multiple offer situation is tricky. The Seller can accept what ever offer he or she chooses. The order that they arrive makes no difference. First come first serve is not the case. Additionally,
the listing agent has an obligation to submit all offers to the Seller. A verbal offer conveyed to the Seller and accepted by phone will not guarentee any assurance to the purchaser. Prior to actually signing the contract, another offer may come in that the Seller prefers that one over the first offer. It may be a higher price or it may have better terms. It is your job, mister Realtor, to explain the risk to the prospective buyer. My advice is to explain all the options to your Seller and all the details to the buyer and you will be fine. Don't make decisions for your client. Educate your client and let them make their own decisions. That is the way to build a trust and an advocate for your company and yourself.