Purchasing a property is a very exciting time for Buyers, and there is nothing we love more than assisting clients with that experience and seeing the expressions on their faces when they get the news that their offer has been accepted.
In today’s market, we continue to see multiple-offers on houses, townhouses and condos across the Lower Mainland which can make buying a property quite daunting. The good news is that our team has helped hundreds of Buyers successfully navigate these challenging environments, so you are in good hands.
The fundamental reason that multiple offers have been happening for a number of years in Vancouver is because demand is outpacing supply; although, there is much debate about the underlying causes of the high demand and low inventory. Many cite the super-low interest rates as the main driver of high demand. Others say that not enough new homes are being built due to government red-tape. Regardless of the reasons, multi-offer situations have been happening for several years and Buyers who prepare themselves have a better likelihood of successfully acquiring their preferred property.
You have probably heard some people saying that subject-free offers have become the norm; however, we do not condone Buyers making subject-free offers unless they have obtained full financing approval, completed an inspection, researched insurance prices, and read all of the relevant documentation pertaining to the property.
Below are some tips to help Buyer’s strengthen their offer in the case they face competition:
1. Pre-approved Financing – The very first step is to apply for mortgage pre-approval from your financial institution so that you know how much you can spend as well as credit scores, interest rates, and required down-payments. Generally speaking, pre-approval often takes up to 7 days and requires Buyers to provide documentation, including an application, pay stubs, income tax notice of assessments, and proof of down payment. It’s important to have a clear line of communication with your mortgage specialist prior to writing any offers.
2. Fully-approved Financing – Once you find a property to purchase, obtain full financing approval for that specific property. This means your bank will review documentation about the property and complete an appraisal so they can confirm their willingness to finance that specific property. They will also confirm the exact amount of down payment and mortgage for the specific property. Generally speaking full financing approval takes an additional 4-7 days after pre-approval, so 1-2 weeks in total for both pre-approval and full-approval.
3. Inspection – We recommend that you always do an inspection. If possible, rather than including a “subject to inspection” in your offer, consider arranging an inspection prior to making an offer.
4. Insurance – Insurance premiums have gone up recently; therefore, obtain some property insurance quotes before writing an offer so that you are not surprised later.
5. Documentation – Carefully read documentation related to the property before writing an offer.
6. Completion Date – If possible, align your dates with the preferred Completion and Possession dates of the Seller to make your offer more attractive.
7. Deposit – Some buyers submit their deposit in the form of a bank draft at the same time as the offer to show they are totally committed and will not walk away from an accepted offer. Deposits are typically around 5% of offer price and they are held by the Buyer’s agent’s brokerage and then transferred to the Buyer’s lawyer prior to completion.
8. Personal Touch – In the event that two Buyers have very close offers, then sometimes an authentic personal message from the Buyers to the Sellers can help make the difference. Or at least the message or personal letter might encourage the Sellers to give you another chance to re-bid.
It’s very important that you get the best representation possible to effectively navigate and negotiate multiple offer situations.
YourHomeTeam has over 25 years of experience and expertise and has helped thousands of clients through all types of market conditions, including navigating multiple offer situations with great success.
Here is what some of our clients, who won in multiple offers, have said:
“We are so thrilled with our new home…and you made it happen! Your help and guidance has been incredible over the past couple of years. We are so grateful! Thanks for everything” ~ Jared & Laura
“Annette and the rest of the YourHomeTeam group were amazing to work with. They were always quick to address the endless questions and requests we had as new buyers. Their knowledge of the market and attention to detail kept us well-informed and confident when putting in offers. Throughout the whole process it was clear that they had our best interests at heart, going to bat for us over and over again. It is because of how effectively they represented us that we were able to secure our new home” ~ Noah & Baily
“Thank you for going above and beyond for us and for helping us buy our first home! We’re so grateful for all of your hard work and sage advice” ~ Marlena & Quin
“My husband and I are both first time buyers and both our families are out of town; so we really had minimal guidance or support going into this whole thing. Home buying is not as easy as it may seem… Annette and YourHomeTeam were such a huge resource and help throughout the whole process. But the best part was Annette’s insight and experience in the field; she took the time to understand what we were looking for, what were deal breakers and what things we could be flexible on… we got the price range and location we were looking for and really wouldn’t be here if it wasn’t for Annette and her team … we mean every word” ~ Anji & Pierre
If you are considering buying or selling, connect with us, and we will help you strategize your real estate transaction.