It started happening about this time last year – “holding offers”, or in other words, home sellers waiting about a week before looking at and accepting the best offer to buy. And that is what it is, an offer to buy. You get one chance and usually only one chance to put in your best.
The offer to sell is actually an offer to take bids, to buy on the seller’s terms, when and where it’s up to them.
Bully offers will not be accepted or considered.
Here’s how holding offers works
A house goes onto the market. The backlog of ready (and some not-so-ready) buyers want to see it right away. Their agent says, “sure thing, but offers are not being accepted until a next Wednesday”. Sometimes, the offer date is only two or three days away. Sometimes it is ten days to two weeks away. Personally, I think a week is perfect. A week gives everyone who wants to see it a chance to see it. And, it is not so long that potential buyers cool off. A week seems to work best, best of course for the seller to encourage and receive multiple offers, most above asking price and without those pesky conditions of home inspection and mortgage financing. That’s how it is now and has been since about this time last year.
How we differ from Toronto
I sell and help people buy real estate in Waterloo Region. My knowledge of how the Toronto and other markets work is not first-hand. Having said that, I understand that we do things differently here than they do there.
1) Home inspections:
I understand that sellers in the GTA will often do a pre-listing home inspection of their homes. That way, they will be able to fix or otherwise address anything that need to be fixed or otherwise addressed. They will leave this home inspection report out on the kitchen table for all showings and open houses and offer it electronically for any agent or customer that want to see it.
In Kitchener-Waterloo, our home sellers tend not to do this. Our buyers have a choice to do a home inspection before they offer or, like the olden days, forgo the home inspection altogether.
Frankly, I think the Toronto method is better, not only for the buyers, but for the sellers too. I believe home buyers will have more confidence in a home that has been inspected, even if they are a third party to that inspection.
2) One chance per house:
Through my agent friends and other connections into the BIG T.O. I understand that offer presentations work a little differently in the GTA. There, I’ve been told, offer negotiations have a first round, second and sometimes third. That means the home seller in the first round holds the best offer and asks the others if they would like to submit a better offer. This could happen a second time as well.
Here in Waterloo Region, home sellers tend to accept (or work with) the best offer of round one. There is no round two, not typically or unless you ask for one.
“Holding offers” is now the norm, at least for now and for the foreseeable future. The balance of power in a seller’s market certainly shifts to the seller. And to the home buyer, the buyer who most wants the house, most usually gets it. Simple.
If you are interested in more real estate terms please visit me at Kitchener Waterloo Real Estate News