You are not in competition with multiple buyers

Listing agents are not fibbing when they say they have multiple offers in hand. They’re not trying to trick you. They are following the lawful instructions of their client. What another person and their agent do with that information is up to them—doubt at your own risk.

Even in a pandemic, homes are attracting multiple offers. Three to five offers are common. The most I recall from this year is twenty. Even with nineteen offers already in, our client did not compete with even one of the bunch. And I say that for two reasons.

First, competing is a mindset; it’s not a real thing. Choices are real, and by making decisions based on the information and knowledge of their intent, our clients submit offers that aren’t trying to beat anyone; the offers they write are the offers others have to overcome.

The prepared buyer client we represent believes they can show their commitment to owning by what is or isn’t in their Offer. An owner who values a committed buyer who gives them terms that allow them security and a satisfactory net is likely to commit to that buyer. And I know this because it happens most of the time.

The second reason our clients are not competing with others is that 9 out of 10 offers an owner receives will not be written clean enough for the owner to accept. Either the Offer will have flaws or deficiencies, or unnecessary contingencies. The Offer that a seller can take without a counteroffer and leaves them in a secure position knowing the buyer is as committed to getting to closing as they usually stand alone when compared to all of the Offers on the table.

Did our client’s Offer stand out from the other 19 in the case I mentioned above? Yes, it did. This family wrote one Offer on one house and now own that home. They trusted us. They didn’t compete. And, their Offer was not for the most money.

Control of Your Home Equity…Problem Solved

The reason to start a business is to solve a problem other people have. All different intents are outcomes. I’ve never heard anyone say; There are too few real estate companies. We need one more.  My son Patrick and I set out to apply our skills and talents to solve a problem, and it didn’t take long for us to identify a solvable situation.  

Inspired by the ideas of Seth GodinSimon Sinek, and Malcolm Gladwell we began by asking “Why” questions. Why do brokers charge 6.0% commissions? Why do homeowners pay 6.0% commissions? The answers lead us to ask “What” questions. For example, What do brokers do with the commissions they collect? What do home sellers use to pay the broker’s commissions? What do home sellers get for the commissions they pay? More or less, the answers looked like this: Brokers charge 6.0% commission because home sellers are willing to pay 6.0%. The commissions are paid from home equity savings earned by the homeowner and spent to support other people’s lifestyles. So, what’s the problem? We believe the problem in need of a solution is as homeowners, we pay an unfair share of our home equity for overpriced real estate service from under-skilled practitioners who provide no discernable service difference, all of which achieve the minimum standards of the law.

Essential Real Estate Solves The Problem of Excessive Equity Loss

Broker commissions are a form of a regressive tax. Six percent of a $400,000 is $24,000 for everyone who sells a home for $400,000. The regressiveness is that the $24,000 is not 6.0% of the home equity held by everyone who sells the $400,000 house. It is 6.0% of their equity of they owe ZERO, but few homeowners owe nothing against their home. A typical seller of a $400,000 home might have $100,000 to $200,000 in equity. At 12% to 24% of a person’s equity, that broker fee is significantly more of a burden. 

Take Control of Your Equity and Expenses

Homeowners pay dearly because of two false beliefs about real estate commissions. (1) Real estate agents don’t decide which homes their clients see based on the commission offered to them. The same buyers who would see your house if you promise to pay 3.0% to their agent will see your home if you offer 1.0% commission to their agent, and there is no evidence to prove otherwise. That’s nonsense, and we can get more into why I know that’s a false assumption. (2) Commissions are not heavily invested in marketing your home. The lion’s share goes toward real estate broker self-promotion, capturing more buyer and seller clients, company overhead, staff, and lifestyle choices. 

The listing consultation you receive from us shows you how to take control of your home equity and your selling expenses. If controlling the spending of your capital sounds like a good idea to you, talk to us. Anyone can sell your home. We make sure the transaction is negotiated to your advantage with you keeping more of your home equity.

Essential Real Estate, LLC Leaving you with control of your home equity.

No I won’t agree to extend buyer’s appraisal or financing contingency.

As long as contingencies have existed, there have been REALTORs who think deadlines are suggestions. Since when has it been a home seller’s responsibility to extend an appraisal or a financing contingency when a buyer’s lender fails to deliver by the deadline? Never. And still, I hear from licensees who are astonished to have their amendments to extend rejected. I wonder if the agent who expects an automatic extension comprehends the mechanics of the contingency?

If the home buying process is like a journey from here to there, a contingency is an off-ramp, should the traveler decide to quit the trip or go a different direction. Those off-ramps are helpful for the buyer and not so useful for home sellers. As we move along the road from acceptance to close, we eliminate the off-ramp contingencies by satisfaction or by failure to act before the deadline. It’s possible for a contingency favoring the buyer to be desired by the home seller, but it’s unlikely. Whether the contingency is satisfied or becomes moot by the failure of the buyer to take action, it’s typically to the more significant advantage of the home seller to have the contingency gone.

Adding more time for the buyer to decide if they want to exit the transaction at a later date is unwise. Only an agent who doesn’t comprehend the contingency will think it’s prudent for a seller to extend a missed contingency. And don’t tell me it’s necessary to show good faith. Agreeing to a condition included is good faith. It’s good faith for the buyer to make sure they meet the deadline.

Overpaying should not be your best idea to getting an offer accepted.

Ask any real estate agent or attorney to give you two ideas to get your offer accepted in a seller’s market. One idea they will say more often than not is “Offer more than the asking price.” Real estate professionals who believe overpaying is a viable option haven’t done enough thinking to earn trust, and they far outnumber the professionals who don’t use price as a first, second, or third strategy. Note of caution: You can’t tell who the agents are by looking at their age, sex, experience, or company.

I read a post by an agent who equated getting offers accepted to winning athletic competitions. Winning competitive races appeared to be her thing. I understand that competitive drive when it’s my game. Representing people in a real estate transaction is not a sport. When winning is the objective, what might be the costs? Well, for one, the agent who is inspired by competing to win is spending your money and your security to satisfy his or her self interest. I believe a safer attitude is to see the transaction as an opportunity for the client to acquire a home on terms they will be satisfied for long after the day their offer is accepted. For a person to know what the satisfactory terms look like it’s my job to show them the advantages and consequences of different agreement terms. When a person knows what is possible and can see possible outcomes, they make informed commitments. I’m certain that owning a home without overpaying in money or risk rates higher on the list than owning at all costs for most people.

Essential Real Estate is designed to give smart people reliable options to acquire homes without overpaying. Coming out of the recession in 2014 we committed to taking our knowledge of the Offer agreement and other firm’s addenda to the highest level; intending to use that knowledge to give our clients more ideas to give themselves an advantage when the home they want to own is the one more people want to own. There are hundreds of people who own homes they would have lost or paid too much for had we not learned and taught this negotiating strategy.

Anyone can write offers committing you to spend more than the asking price. That’s simple. It may be effective if by effective you mean getting your offer accepted and the agent paid. Our clients do not settle for just an accepted offer. They don’t expect a steal; they expect smart ideas to acquire a home on reasonable terms with the risk they can tolerate.

Essential real estate service is contract drafting and negotiating. It’s not easy, but it’s worth it when the cost is your money and your security. Before committing to working with us, or any professional, ask to hear ideas to help you achieve your goal and not lose your shirt in the process.