Who is your competition?

Sometimes when I buyer finds out there are multiple offers on a property, or even just one offer, they choose to not proceed. By either canceling their showing or choosing not to make an offer even if they’ve seen the house and like it. Often they say something like, I’m not willing to fight over it or I don’t want to be in competition.

This is interesting to me. The offer the seller has may be amazing, maybe it isn’t. Just because the seller has one offer does not mean you have to offer more than you’re comfortable paying. Never offer more than it’s worth to you. No one can make you “fight over it.” But why wouldn’t you make your offer to see if it might be acceptable to the seller?

And, surprise twist, you are always in competition. If you are actively looking at houses that are publicly listed for sale, you are always in competition. Other buyers are in the market place looking. Just because you don’t always have an offer in on the same house at the same time doesn’t mean you are not in competition.

As the seller is reviewing any offers they have, they are not just comparing them to each other. Especially, if they are below asking price and/or if the house has only been on the market a few days.

They should be comparing them to other potential buyers as well. If a house has been on the market for a few days and is still getting showings, there are other potential buyers out there. Sellers don’t just at the offers in front of them and say “I have to pick one of these.” Nope, if none are what they’re looking for, they can accept none and keep showing the house. Had you made an offer, maybe it would have been accepted even if you didn’t think it was competitive. Or maybe they accepted an offer lower or with worse terms because yours wasn’t on the table.

It’s also important to remember that the seller is under no obligation to tell you if they have other offers. They are required to disclose if they have an accepted offer. But they do not have to share if they have an unaccepted offer. So you could actually be in a multiple offer situation without knowing it. Certainly, often sellers do want to tell buyers if they have other offers, hoping that it encourages you to bring your best offer and move with a sense of urgency. This is historically effective. However, only you determine how much the house is worth to you and how much you are willing to offer so you don’t need to change any of your behavior based on the knowledge of other offers. Worried about getting caught up in the competition? Learn more here: https://www.kirawitherwax.com/post/don-t-get-caught-up-in-the-competition

I worked with buyers once that had a overnight rule. They would never make an offer without sleeping on it overnight. This had nothing to do with the seller or buyers they were competing with. It was a boundary they created for themselves because they didn’t want to rush into anything. Thinking it about it overnight and discussing it with each other in the morning allowed them to have clarity around if they really wanted the house or if they just got wrapped up in the excitement. A few times, they lost houses because someone made an offer and they weren’t willing to break their rule. I respect that. They weren’t changing their plans because of an outside force. If they liked it after 24 hours, they made an offer they were comfortable with, whether there were zero other offers (that we knew of) or 10. There is always a chance a seller won’t choose your offer. That is true if there are many offers or if yours is the only one. The only way I can be certain they won’t choose yours, is if you don’t make one.