How to win against investors?
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Anonymous
| I want to buy in a particular neighborhood but can only comfortably afford a fixer upper. I will be financing and likely bidding against all cash investors. How can I make my offer more attractive than these all cash buyers (without overpaying or waiving financing) to a seller? |
Anonymous
|
Offer more.
Appeal to their non-financial senses. |
Anonymous
| I don't think there's a good answer to this question. Investors and other all-cash buyers typically win out for a reason. Having lost on a couple of homes to investors in a hot neighborhood, we just picked a different neighborhood. Sorry. |
Anonymous
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You can try writing a heartfelt letter to the owner/seller. Say you're a family, you've wanted to live in the neighborhood for quite some time, and keep finding yourself competing with investors who will not add anything to the neigbhorhood.
Might appeal to a rich, bleeding heart buyer. |
Anonymous
|
We won in a case like this. You just need to out-bid them. In our case, the investors were all offering about 10% below asking due to the odd shape of the lot making it difficult to do a big teardown. In this case, the lot was narrow but deep, and they like to put in 2-car garages in a teardown.. hard to fit that into the lot.
Basically investors are not emotional and are strictly numbers-based. They'll pay to make the deal work financially, but not a penny more. |
Anonymous
| Oh another trick. Bid on a short-sale. Investors will shy away from these because they can take months to close (the lienholders need to agree on how much they'll lose) and they have strict schedules for when they plan to do building. |
Anonymous
| Write a letter. We did that and it was a major factor in the sellers (an older couple) accepting our offer. |
Anonymous
| Waive contingencies. |
Anonymous
I have an elderly neighbor who has been in her home for 30 some years and the house would need some work to make it livable. She is waiting for an Independant living unit to open up and while her house isn't on the market yet she has already gotten offers from a few builders. She would love to not see her house torn down and if she received a heartfelt letter from a family interested in buying her house who could match what the builders would pay, offer no contingencies and let her leave the crap she doesn't want yo have to move or get rid of since in theory it would go to a landfill with the rest of the house she would definitely pick the family. |
Anonymous
| We wrote a heartfelt letter and offered to let them leave their (minimal) old furniture in the house. In our case, we were making a very low offer on a house that had been on the market for way too long, not outbidding investors. It worked and we feel incredibly lucky now, 9 years later. |
Anonymous
| Get the seller's agent as your buyer's agent. |
Steve
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|
You also want to get out ahead of the investors and reach homeowner directly.
One of my broker partners found his own tear-down home in N Arlington by knocking door to door. One of our own buyers has received multiple pre-market callbacks from a few door hangers we placed last week. |
Anonymous
| We beat out an investor - part of it depends on on their own metrics and the cost to remodel the home. In our case, we offered near asking (house was worth more than the list price) and investor/builder offered less. Plus we wrote a nice letter the owners. We still had all the contingencies, so I guess the letter and the higher price won out. So don't always assume that a builder/investor will beat you on price - my realtor said that is not always the case, depending on how the house is priced and what the builder intends to do with it (in our neighborhood, the homes aren't torn down - they are gutted and expanded). |
Anonymous
| I'm not a bleeding heart liberal but I would absolutely rather sell to a family than an investor. Especially if the offer is higher. Try to have a few contingencies as possible and include a loan pre approval letter. |
Anonymous
| Offer above market rate. I also think it's not a good idea to allow these old used up homes to ruin our area. We are the capitol of the nation and the old homes make it look like a run down developing nation. |