What to do when there are multiple offers?

Multiple offers are still happening in this market. If a property is priced right from the start, the market will often respond enthusiastically and more than one offer will come in. On the other end of the spectrum, it never fails that a good property will sometimes sit, sometimes due to a slightly-high price, sometimes for no apparent reason, and then all of a sudden, there are several offers. It only takes two offers to make things sticky.

The bottom line is that if you make an offer on a property and another offer comes in, you need to decide how much you want the property and how much the property is worth based on the comparables and weigh both these factors. Then you can come up with your number. If you are planning on staying for awhile in Hoboken, paying a bit higher on a property may well be worth it. You have to consider how it will improve your quality of life...does it put you nearer to the train or the bus. Is it a lot more room than you now have? On the other hand, the other bid may not be great. If you are on the fence about the property or feel nervous about how much you are paying or can afford to pay, then you should make an offer in keeping with your budget. But if you really want a property, even in this market, and there is another offer, you should usually offer the list price....at least.

Additional important factors that could sway a seller are: putting down a large deposit (that inspires confidence in sellers that you have the money and will not be turned down for a mortgage. It can make you look better than your competitor who is putting down 5%.), or moving the closing date to best accomodate the seller, or waiving the home inspection contingency. All of these factors can help you beat an opponent.

A good realtor can be very helpful in this situation. He/she can get a sense of how strong the other offer is from the listing agent. The buyer's agent tries to figure out what her buyer needs to do to get it. The listing agent's game is to get the best deal for her client but also one that is solid and one she feels will stick. She may take into account deposit amount, the way the buyers conduct themselves in terms of making the offer, even the quality of the realtor bringing the offer. Her job is to protect her sellers and get the best price for them.

Bidders in a "bidding war" often console themselves, when they lose, with the phrase: "Well, I guess it wasn't meant to be." But it has been my experience that bidders who lose were fearful. They did not go high enough because either it was out of their price range (they were already stretching) or due to a fear of the bidding process.