What could make a seller pick a buyer over others to sell his property to? This is the million dollar question that every investor wants to know.
The terms of a buyer’s offer are all considered carefully by a seller when choosing whether to accept an offer or not. In addition to the price, a buyer’s offer can include contingencies and terms. Usually, an offer with little to no contingencies are considered to be stronger candidates. A seller also wants the buyer with the best terms.Depending on the seller’s situation, the buyer’s flexibility around the closing date could also play a big factor. After all, in the real estate game - timing is every bit as important as location.
Another interesting point to note here is that numbers don’t always mean everything. This may come as a shock to most, but the buyer with the highest bid doesn’t always get the home! Here’s why.
Just because you have found “The One”, and offer the highest price, doesn’t mean your dream home’s seller will pick you by default. With money aside, there are a number of characteristics sellers look for when picking the right buyer. Locking down dream home doesn’t always mean offering the highest bid or cash upfront.
There Is No Price Tag On Emotions
There’s one thing that sets commercial real estate transactions from residential buying and selling, and it all comes down to one word: Emotions. There’s a certain emotional attachment to the buying and selling of a home, which means that people tend to like to do business with those whom they like and trust.Emotions are priceless. When someone is selling a home that has an emotional pull - maybe they grew up in that home or it is the home their children were born and raised in - there’s a natural unspoken price tag, one that is ultimately priceless to some degree.Don’t be mistaken that money is not important. Offering the right bid can make or break your deal but how the seller ultimately feels about you as a person can be even more crucial in the deciding factor. Treat a seller’s home with respect and don’t insult the many things you hate about the place and what needs to be changed in order for you to give a good price. Nothing infuriates a seller more than disrespect and insensitivity.
This goes the same for landlords who are leasing their homes out. At the end of the day, they are renting out a part of their life to a stranger so it’s your job as a renter (borrower) to be friendly and respectful. A less than friendly demeanor could you your deal breaker.
When dealing with residential transactions, a seller’s primary goal is not always about profit. There’s a lot of emotions involved with selling one’s home and a higher cash offer does not always guarantee a deal. Some sellers will choose a buyer with whom they have a better connection with over cold hard cash. This is why some of the tougher deals often times end up as a family purchase in the end. Sellers who have an emotional attachment to a home will be more likely to pass the torch to someone who they believe will take good care of their home as new owners.
In order to up your chances of being picked by a seller, you should aim to figure out the seller’s unique motivation in putting their home on the market. Understanding the reasons why can be a powerful tool in a seller-buyer negotiation. Whereas some seller just want to get rid of their property as quick as possible, others are looking for a specific type of person to take over something that means a great deal to them. The intangibles are just as important as the price. Try to find out as much information as you can about the seller. Ask your agent, talk to your seller’s neighbours - the more information you have, the easier it is to come to a mutual understanding that pleases both parties. People make the mistake of using money as the trump card, but throwing out the highest price may not hit the emotional button that your seller is looking for to put his/her mind at ease. Sellers are looking for buyers who are highly motivated to buy the home.How can you as a buyer give the seller peace of mind in handing the property over to you? That is what you need to figure out.