There is stiff competition when buying property in today’s market. Real estate investors need to be ready for multiple offers being presented and hot bidding wars. With the high demand on properties, how does an investor stand-out and win? Here are five strategies I utilize— and you can too— to make my offers stand-out and win.
Develop Relationships In Advance
When you have an already developed relationship with real estate agents and brokers, that can help significantly in winning bidding wars. Contrary to what you may believe, you actually don’t need to make the highest offer to win the deal. What you do need is the offer that the agent likes most. What that can boil down to is confidence in closing and ensuring the agent is paid commissions quickly. If the agent trusts that you are qualified as a “closer”, that puts you above the crowd.
“Go hard” by making strong offers. If you aren’t interested in paying more, drop a higher earnest money deposit. This way, the seller knows that you are serious (more so than the others in the group). Recently, my partner and I made an offer with $50k of earnest money. It was a multi-family property, with a purchase price of $900k. The seller realized that we were very serious at that time.
Have all of your important contacts lined up; inspectors, financing, contractors, and appraisers. When you have shorter inspection times than your competition, you will give sellers confidence in your offer. Make sure you and your team can meet the deadlines. Also, be available for anything! Having your loan pre-approvals, contractor quotes, and value estimates ready to roll will be a big benefit. You can give proof of this to the seller to show them if needed and make your case stronger.
Face to face
On multiple occasions, I have shown up to meet with sellers directly, with a gift, in addition to a purchase contract. Not only does this build rapport, but it also helps the seller put a face to a person. This is going above and beyond and has allowed me (for sure) to get deals over other competitors.
Be an ‘As is’ buyer
Be the buyer who is easy to work with— otherwise sellers will walk away if you appear to be difficult. Even if you put up an amazing offer, being the one who nitpicks minor building repairs, in order to have the purchase price reduced, will not make a seller want to close the deal with you. When you have a good reputation and know as a straight shooter, you will get more opportunities.