Multiple Offers – How to Win

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Everyone’s talking about it. The market is on fire and if you’re a seller, THAT’S GREAT! But if you’re out there trying to find a home to purchase right now there is plenty of competition and quite frankly, it’s probably getting to be very difficult.

But through my many years of experience and dealing with multiple offer situations while representing the buyer’s side of the transaction, I’ve developed some very effective strategies to help you win the bid. Here are five tried and true ways to turn up the heat on your offer and get it noticed.

Know Your Limits Then Reach for the Sky
Now’s definitely not the time to be playing negotiating games. Sure, that might have been a strong strategy just a few years ago when there was an overabundance of homes on the market and not near as enough buyers to accommodate them. But today, it’s a completely different story. Figure out the highest price you are able and willing to comfortably pay in a multiple offer situation and don’t be afraid to offer that much.

Make It Clean, Make It Simple
As a Realtor® that also represents sellers, I often come across a stack of offers and am sitting there sorting through them with the expectation they will be presented to the seller. The last thing I want to do is confuse the seller with jumbled language, lengthy verbiage or unreadable handwriting leaving us both to wonder what an offer says. Write a simple, clean offer with as little room for confusion as possible without being vague. A simple cover letter summary page is a great way to highlight the bullet points of your offer.

Demonstrate Financial Strength
No seller wants to dapple with offers that are not 100% solid in terms of financial viability. When looking at several offers, a small earnest money deposit or limited down payment can be viewed as lack of interest of worse, appear to be an inability to afford the property. If you are offering to make a down payment, show proof of funds through a letter from your bank or investment firm and make sure to include a preapproval letter from your lender.


With Down Payment and Deposit, Less Is Not More
When sellers are reviewing offers they are looking for what they perceive as strong interest. It goes without saying that more money is a demonstration of high interest level but how you offer to pay is another consideration. Cash offers are always very attractive since they entail fewer contingencies and procedural hurdles to jump through. But even a larger down payment is more attractive than very little money down. If you can afford it, put down at least 10 percent on the home and submit an earnest deposit amount of at least 1% of the purchase price.


Minimize Contingencies
Many offers contain contingencies, upon which the purchase agreements depend before being executed. For instance, a buyer might make an offer on a home contingent of the sale of their existing home. There are also inspection and mortgage contingencies. You may not be able to eliminate all of them but whenever possible try to be flexible. Shorten the length of time for buyer investigations by offering to schedule your inspections soon after your offer is accepted.
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These are just a few of the strategies we employ when serving our buyer clients in what is a very strong seller-controlled marketplace. If you’d like to hear some more of the tricks we have to get you the home of your dreams, contact me today at 973-214-0691.

Real Estate Market Update – March 2013

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As we speak, there are more sales and homes going under contract than we have seen in a long time. And when you consider that our inventory levels are also at an all-time low, it’s apparent just how hot the real estate market really is these days! We did a review of this year’s numbers compared to the same time last year and the numbers are staggering. Here’s a look:

Buyers Want to Buy But There is Almost No Inventory Out There

Our marketplace has seen some interesting ups and downs throughout the past but who could have predicted such low inventory levels? In fact, if you look across the board at all our towns hitting the MIdTown Direct Train lines, we have tons of buyers out there eager to buy and hardly any houses for them to choose from.

Multiple Offers, Bidding Wars and Artificially Inflated Prices Are Back

With the staggeringly few homes available on the market, homes that are priced well and in great condition are the first to go. And they go with a bang – with multiple offers and bidding wars that have been resulting in artificially inflated prices. Sellers are enjoying the upper hand, often getting more than asking price for the sale of their homes.

Inventory Levels Drastically Reduced from Last Year’s Numbers

In South Orange we currently have 20% fewer homes on the market compared to the same time last year.  West Orange is down by 30% and Berkeley is also down on inventory. Conversely, the number of homes going under contract is dramatically higher, with New Providence experiencing the highest jump at 79% more homes under contract this year. Chatham Township saw a 169% increase in pending contracts in the year’s first three months. Chatham Borough has a 50% increase of pending homes, Berkeley Heights is up 61% -- the list goes on.
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All this means one thing for sellers; now is the time to jump off the fence! If you’ve been wondering if your home would sell or if you haven’t been sure whether it’s the right time – trust me when I tell you that it could not be a better time.

Tax Appeals 101 for the State of New Jersey; How to Save Money on Property Taxes

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Nobody likes to pay taxes. So when it comes time to pay taxes on your property, it’s the same drill every year; when on the one hand homeowners like to think their home has a high property value, at tax time they do their best to “lower” that value and pay less taxes.

Tax Appeal Filings Window Jan 1 to April 1, 2013
Right now, we are nearing the end of our window where homeowners can appeal their property taxes to their local municipality and attempt to lower their taxes. There is only one window of opportunity each year to do this and it has saved countless homeowners a lot of money. First, you need to find out whether your taxes are too high.

How to Investigate Your Property Taxes
The first thing you will need to do is to find out your tax ratio. This is the assessed value of your home, divided by the actual market value. The reason property values from the municipality are often different than what you might expect to sell your home for is that often due to limited resources a tax assessment can be one from a while back. Towns do not go back and assess all properties too often because of the sheer expense involved.

First, determine your home’s market value. Your Realtor® will pull comparable sales in your market to see what other similar homes have sold for in the previous year – and then come up with todays’ market value. Next, determine the ratio between your assessed value and the market value.

Finally, look up your municipality in Chapter 123 (New Jersey’s Statute that governs how properties are taxed) and if your ratio is more than 15% of the average ratio there is a good chance you will have a successful tax appeal.

Choosing a Real Estate Attorney for Your Tax Appeal
Once you realize there is a chance your tax appeal will be successful, meet with a qualified and reputable real estate attorney for a consultation. It is important to share accurate information and it is equally as important that you choose a good attorney that will be honest about your property. The risk with a failed attempt to appeal your property taxes is that you could end up having to pay higher property taxes.

Keep in mind, a good attorney will assess the likelihood of success in your case and let you know. Choose an attorney that will charge you based on a contingent fee, so that you only end up paying for their services if and when you have a successful tax appeal.
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For more information on this topic or anything else real estate related, please contact our office today. You can reach Evan Drachman directly via phone or email and also visit his firm’s website (below).

Evan R. Drachman, Esq. | Dollinger Drachman, LLC
293 Eisenhower Parkway | Suite 310 | Livingston, New Jersey | 07039
p: 973-992-1700 x 106 | f: 973-992-6835 | direct fax: 973-629-1303 | edrachman@dollingerdrachman.com