Right now in San Jose (and Silicon Valley generally), entry level single family homes are selling very briskly. In many cases, sellers are getting multiple offers when they put their clean, updated home on the market with an appropriate price & good marketing.

I work with both buyers and sellers, and can show you what will help your position and what will hurt it if you are writing an offer in a “multiple offer” situation. This will be the first in a series (I can’t put it all into one post) of tips on how to write a more compelling offer when you’re up against other buyers.

Purchase agreements are all about price & terms. Usually price is the main factor, but sometimes the terms can really throw the balance one way or the other. Often by providing better terms, you can nose out the competition.  Or conversely, if a couple of offers are close to each other generally, but your terms are worse, your “position” will suffer for it.

What are “terms”?  They’re the “everything else” of the offer. Things like:

  • initial deposit (amount/percent of offer price)
  • as is (or do you ask for repairs?)
  • number & length of contingencies
  • documentation  (preapproval letter at a minimum)
  • length of escrow, seller move-out timeframe
  • who pays for what

Once I heard of  buyers who wrote in as a term of the offer that the sellers’ dog would stay with the property.  The sellers were so outraged that they refused to sell their house to those buyers at any price.

These are just a few of the terms found in an offer – aside from price, these may be the most important terms for your offer. If you mess up on some or all of these, your contract will be given less consideration by the seller.

Got great terms? That’s awesome. But don’t get too cocky – at the end of the day, the seller does still want fair market value. So for instance, if you have “all cash” and can close fast, that is great and most sellers will want to work with you. But they won’t take an enormous discount for it. If a home’s worth a million dollars and there are several offers at one million dollars (or close to it), that seller will probably not take an offer of $900,000, even if it is “all cash”. If the seller is in a big hurry, he or she might take $950,000 or $980,000. Most of all, it will make your bid the preferred one. But in most cases, the seller won’t take a 10 or 20% discount for all cash.  So get an appropriate understanding of the power of good terms, neither underestimating nor overestimating them.  Often, truly excellent terms may be “worth” 1 – 5% to a seller, depending on what kind of terms are involved. Each situation varies, of course.

Next post on this topic: a list of financing terms (questions I ask my buyers prior to drafting an offer with them) and a discussion of the initial deposit, increase of deposit, and related concepts of liquidated damages and defaults.

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Mary Pope-Handy
Realtor
ABR, CIPS, CRS, SRES
Sereno Group Real Estate
214 Los Gatos-Saratoga Rd
Los Gatos, CA 95030
408 204-7673
Mary (at) PopeHandy.com
License# 01153805


Selling homes in
Silicon Valley:
Santa Clara County,
San Mateo County, and
Santa Cruz County.
:
Special focus on:
San Jose, Los Gatos,
Saratoga, Campbell,
Almaden Valley,
Cambrian Park.
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Valley Of Hearts Delight
Santa Clara County Real Estate,
with an interest in history

Move2SiliconValley.com
Silicon Valley relocation info

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Silicon Valley real estate,
focus on home selling

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Mary’s Blog Awards
Top 25 real estate blogs 2016
2016: Personal Income's list of top 25 real estate blogs.


Best Realtor blog award
2016: Coastal Group OC's list of best Realtor blogs


The 2009 Sellsius list of top 12 women real estate bloggers
2009: Sellsius list of top
12 women real estate bloggers


Mary Pope-Handy's Live in Los Gatos blog won the 2007 Project Blogger contest, sponsored by Inman News and Active Rain

2007: Mary Pope-Handy and Frances Flynn Thorsen win the Project Blogger Contest for Mary's Live in Los Gatos blog. The contest was sponsored by
Active Rain and Inman News.


Non blog award


Best real estate agent in Silicon Valley from the San Jose Mercury News poll of readers in 2011
"Best real estate agent
in Silicon Valley"

2011 readers' poll,
San Jose Mercury News

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