The ins and outs of Bully Offers
A ‘bully offer’ or more appropriately known as the ‘preemptive offer strike’ is where an offer is submitted by a buyer in advance of the ‘hold back on offer’ date that has been posted. By disregarding the hold back instructions, the buyer aims to ‘bully’ the seller into accepting their bid before anyone else has an opportunity to submit an offer.
For some buyers, the bully offer is a strategy that can secure a property and save them money.
“Essentially, the idea is for the buyer to submit a bid that is priced towards the top end of value based on recent comparable sales, but is lower than their maximum bid,” says Cathy Rocca.
Here, they bypass their competition and can potentially secure the property for less than they are truly willing to pay. In the event the seller refuses to accept the offer, they can still return on the offer date with the same or better bid, however the price may then be somewhat inflated as ‘emotional premiums’ are more likely to occur.
Buyers submit bully offers for two reasons. One reason is that they are in love with the house and they are willing to offer the sellers a sum typically above the asking price simply to secure it. The other reason is when a buyer has been looking for a lengthy amount of time, has lost many homes in competition and wish to put an end to their search.
There are disadvantages for a buyer when deciding whether it is a good idea for them to submit a buy offer. First off, there’s a chance you will pay more for the home than you actually have to. “It’s important to consider the possibility that if you wait for the offer date, there may be no other interested buyers,” says Tanya Rocca, “and if that were the case, you will probably have overpaid considerably for the house.”
On the flipside, however, there could be multiple offers on the offer date and you could be outbid by another buyer.
The dynamics of real estate require both sellers and buyers be prudent, educated, rational and strategic, specifically in markets where there is an imbalance between demand and supply.
This makes it critical you engage the services of a realtor who has experienced both the rise and fall of the value and volume of real estate sales and prices, has the skill set to negotiate in a changing market, and understands the perspectives of each facet of real estate.
The Rocca Sisters have built a solid reputation for serving their clients with a higher standard of professionalism. Their full service, highly responsive, executive team of professionals are deeply committed to providing timely, ethical and comprehensive guidance, and as such they collaborate efficiently as a team to offer added value to your experience.
Contact The Rocca Sisters Team today and let their personal approach and proven results surpass your expectations. Their sales production and volume is consistently one of the top on the Hamilton Burlington Real Estate Board where your home is.