Too many home buyers, too few houses—that, in a nutshell, defines a seller’s market. And if you’re a buyer who’s in this pickle, that means you need to figure out how to beat the competition.
Typically, when faced with many bidders, sellers will pick the highest offer, an all-cash offer, or the quickest trip to the closing table. But if you can’t plunk down a bundle of cash or waive a home inspection, there might be other ways to stand out, especially if you’re flexible on certain points or have specialized skills.
We’re not saying this is what you should necessarily do, but here’s how some buyers sweetened their offers in more creative (or crazy) ways that actually worked.
Toss in free pizza—for life!
When Rob and Holly Marsh put their Oregon home on the market in 2015, they had multiple offers within days. One buyer named Donna DeNicola had even offered $26,000 over the asking price, but had a feeling that wasn’t quite enough to nail the deal. So to really stand out, the pizzeria owner added one extra topping.
“I just kind of added, I’ll throw in one pizza a month for life,” DeNicola told KPTV. “I’m willing to do anything because I know this market is crazy.”
The Marshes accepted the offer. How could they resist? Besides, when you add it all up, that much pizza was worth serious dollars—a free $20 pie once a month for the next 40 years amounts to $10,000 total. And it makes a business deal a more personal bond.
As DeNicola put it, “I’m going to be buying them a pizza for life, so I will know them very well. I’ll watch their kids grow up.”
Fix what’s wrong with the house
Here’s how Terence Michael snagged a beach house in Playa del Rey, CA, in 2005’s hot housing market: He noticed it came with a detached garage that had been converted into a rental unit. Problem was, it wasn’t up to code—so most buyers were leery.
Enter Michael—who had done some of his own home renovations in the past and knew exactly how to bring this otherwise perfect place up to snuff.
“I asked the sellers for permission to start converting that space back to a garage, not knowing if the sellers would accept my offer,” says Michael. Since the owners had little to lose and lots to gain, they allowed Michael to move forward with his plans, which entailed installing a garage door, removing the bathroom, and making other changes to get the space car-ready. After 10 days, the sellers informed Michael that the house was his—new garage and all.
“I ended up getting the house for $592,000 and then sold it in 2014 for $939,000,” says Michael. “The risk I took was mostly my time.”
Add an open-ended escalation clause
Real estate agent Brendan O’Donnell of Center Coast Realty says it’s common for buyers to add escalation clauses to their offers in Chicago. That means the buyer commits to paying a specified amount more than the highest offer submitted—up to a cutoff price. For example, on a house listed for $450,000 buyers might top any offer by $2,000, up to $480,000.
But O’Donnell recently had clients who took that idea to a new level. They’d been searching for a long time and were willing to pay just about anything to snatch up the right three-bedroom, two-bath duplex condo in Lincoln Park.
“The first open house was jampacked, so we knew that a lot of buyers would be placing offers on it,” says O’Donnell. To stand out, the buyers submitted an offer to pay $5,000 more than the highest offer, with no cap on the total purchase price.
The strategy worked. “The buyers ended up paying $30,000 over asking and have been happily living there for a year,” says O’Donnell.
It’s probably not the best tactic for those with more limited finances, however.
Waive attorney review
The attorney review is a part of the home-buying process when buyers do their due diligence and have the house inspected for any problems before closing the deal. The risk of waiving the attorney review is “substantial,” says Megan Ashbrook, owner of Ashbrook Realty in Chicago. But last year, her gung-ho clients did it anyway for a house with the right room sizes in the perfect location.
“The house was going to need work anyway,” says Ashbrook. “And with the attorney review waived, the sellers basically only needed to set a closing date and that was very compelling to them.” The buyers landed the deal.
Stop by during prime time
Colin McDonald, a real estate salesperson at Berkshire Hathaway, recalls a pair of young, first-time buyers who fell in love with a certain house in Delmar, NY, that had already received multiple offers.
“They were willing to do anything legal to get that house,” says McDonald.
Knowing they had to do something to stand out, these buyers decided to take matters into their own hands, stop by the house, knock on the door, and introduce themselves the sellers.
“Mind you this was at 8:30 at night,” says McDonald.
Even though contacting the sellers directly is often considered pushy, in this instance, it actually worked—which just goes to show that sometimes, nothing beats a little face time.
Offer a trip to Paris … or Broncos tickets
What would you choose: Broncos season tickets or a trip to Paris? In Denver’s competitive market this past spring, these two perks were offered up by buyers represented by real estate agent Kathleen Genereux with HomeSmart Cherry Creek. It may seem extreme, but it actually makes sense to leverage what you have that others might find valuable. In fact, Genereux’s buyers weren’t the only ones who could offer free flights.
“We have a lot of mileage-plus points,” Genereux joked to Denver 7 News. “I might use that one.”
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