Putting an offer in on a house is sometimes a bit of an emotional roller coster ride. If it’s your first time, it is scary and confusing and it comes at the end of a marathon run. You’ve been learning and testing and you’re tired and sunburnt but you think you are ready. It is the moment of truth.
With your realtor, you’ve discussed how the offer process works. He’s gone over the forms. He’s told you what usually happens, what could happen. He’s told you what the market is doing. He’s told you about his recent experiences.
What’s important? Timing. Simplicity. Money. Clarity. Communication.
Your offer has to be good enough to engage the seller. But you don’t want to give away money, do you?
You’ve already seen a dozen or maybe two dozen homes.
You’ve gone over the recent sales of similar homes.
You craft an offer and submit it and…
The sellers did not sign it back. They did not counter-offer. The listing agent called with a vague excuse or perhaps she told you the truth. Maybe she told you why your offer was not accepted. Maybe not. Maybe you will never know.
8 reasons your offer was not accepted:
Your offer was too low
There is a certain sweet spot that you want to hit with offers. You want to be high enough that the sellers will respond to your offer. You want them to know that you are serious. You want to send them a message that you love the house and want to negotiate. If your offer is too low, they think you are just wasting their time, that you have too much to learn, that the chasm is too wide to cross.
Sellers aren’t ready
Just like above, I mentioned how confusing and scary it can be for home buyers, for home sellers too, the process is daunting. And, they have a stronger emotional element to the process. They might have raised a family in the home. Or, they might be getting a divorce. Or, they might be first time home sellers. It all might be happening too fast for them.
As a home buyer, you have been out there shopping, looking at homes, learning about the market for weeks or months. You started with surfing real estate web sites online. Then you visited some open houses. Then you connected with an buyer’s agent and got serious. You, as a home buyer are near the end of a marathon.
The home seller, by contrast, just got started. Last week he contacted an agent and now just a few days later, not only is his home on the market, he has an offer. It is happening too fast, too soon.
If the house just went on the market and there have been ten showings in three days. If the open house looked like the Beijing bus station just before Chinese New Year. If the agent is elated and the neighbours are upset, the property is hot and they know it. Why deal with a low offer when the promise of a bigger better offer is looming large like a big buttery moon on the horizon? This is where greed and avarice appear. “Maybe”, the home seller thinks, “I can get more.”
The listing agent has your offer but now it has expired. They know you want it. You want the house. The agent also knows that other people probably want it. Maybe one more day. Maybe two. When the next offer comes, they are going to call you and ask if you want to compete. You might have been first, but you won’t be the last offer.
More on Multiples
Maybe they underpriced the home purposely to encourage multiple offers. Maybe that is why you thought it was such a deal. Maybe that’s why you offered so quickly.
The best offer negations work when the agents can isolate one issue, usually price. If your offer threw everything but the kitchen sink at them, or had weird and unusual conditions in it, then it is not surprising that it was not responded to. I’ve seen some weird and one-sided conditions come in on offers. Things like asking the seller to cover the buyer’s closing costs or requesting a major repair to be performed. That’s just not going to work.
Problems with the agent
Agents work on commissions. Maybe the listing agent thinks she can “double-end” the deal and take home the whole commission. Maybe she’s stalling your offer as she works her buyers and sellers.
Maybe the sellers simply did not have enough time to respond. Your offer died because someone was out of town and couldn’t deal with the logistics. Maybe they went to bed, or turned off their telephones, or were at the movies, or had a family emergency, or, or, or…
The fear of loss and the opportunity for gain
What started out as an opportunity for gain, has become a fear of loss. You Monday morning quarterback the whole thing. Hindsight is 20/20. I could have offered more. I should have not asked for the fridge and stove. I should have given them more time to respond. Who knows?
It does not matter. It’s a new day and a new reality.
Truth is, you’ll never know. You will never know why your offer was ignored, was not responded to, did not generate a counter-offer. But, you do now have that experience experienced and the knowledge gleaned from it. There will be another home and another offer. Next time, you will be a little closer to getting the house.