With inventory at a historic low, Steve Altermatt of RE/MAX of Boulder explains how real estate agents handle multiple offers, an aspect that has become the norm throughout Boulder County.
Altermatt reports 71 properties currently listed in South Boulder; a figure that is half of what is typical for this area. As for the number of homes under contract, Altermatt reports 12 weeks so far this year with 50 percent of inventory under contract; 2009 had just six weeks with under contract percentages above 30 percent. The REALTOR reports scheduling 44 showings on the first day of showings for one of his South Boulder listings. Though this number is high, it’s not uncommon to have offers coming in the first day on the market from multiple buyers including those who have yet to see the property.
To break the pages of jargon down into digestible, comparable information for clients, Altermatt uses a Multiple Offer Check Sheet which includes the price as well as net price to seller after fees requested by buyers. Loan terms, cash buyers, and appraisal requests are also factored into a seller’s decision.
“It’s a REALTOR’s duty to look at all factors and see which is most likely to close,” says Altermatt, who says some 20 percent of winning offers back out.
Full loan approval, a bank statement to prove a cash buyer has sufficient funds, and whether or not the buyer plans to use the property as an investment property can all sway a seller. Escalation clauses—a clause stating a buyer will offer a certain amount above the best offer up to a capped price—are yet another factor. Altermatt says he advises other agents not to include escalation clauses in offers, eliminating them from the decision process all together. A bidding war, he says, can all too often leave the seller empty-handed.
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