Offer Presentations: How Does This Strategy Work?
There are major benefits to setting an offer presentation date when listing your home. However, sellers should be aware that it may not work out to your advantage in all types of markets.
Offer Presentations: How Does This Strategy Work?
Getting ready to put your home on the market or maybe you’re ready to buy a house in Scarborough and stumbled across a property you really like that has an ‘offer presentation date’. Well, what does this even mean and why do sellers and their agents do this?
An offer presentation date is when a seller sets a specific date and time for when they would like to receive and review all offers.
Sellers often choose to set an offer presentation date as a strategic way to create a sense of urgency and build a competitive environment in effort to drive up the final sale price.
How to Set an Offer Presentation Date and the Pros
When done successfully, setting an offer presentation date has many benefits. Sellers should be pricing their homes at a lower end of the market value in order to attract the attention and interest of many buyers. Typically, the offer presentation is scheduled about a week after it’s been listed.
A lower listing price attracts more interest and showings, exactly what every seller hopes for. By the time the offer presentation date arrives, the increased traffic helps build anticipation and competition. Buyers who wish to submit an offer are encouraged to come in with their best, knowing there may be multiple offers on the table.
If the property can drive in interest, the offer presentation helps get the property sold fast and for the best amount. In competitive markets, sellers may have a bidding war and have options on which buyers offer they would like to accept or work with.
The Cons of Using an Offer Date
Although the benefits to an offer presentation are significant, so are the risks!
If no offers are received on offer night, sellers face the challenge of adjusting their listing strategy, often needing to increase the price to a more accurate asking price. As mentioned earlier, homes are typically listed below market value to attract attention and generate multiple offers. However, if that strategy doesn’t result in any bids, raising the price afterward can send the wrong message to future buyers, potentially raising concerns or creating hesitation when they see the history of the listing.
When Does It Make Sense to Set an Offer Date?
In a seller’s market where there are more buyers than there are inventory, this is a great time to try out this strategy. It’s common for homes to have a presentation date in a seller’s market and for properties to be sold over asking due to multiple offer situations.
In a buyer’s market, where there is more inventory than there are buyers, this may be a bit challenging to pull off. Buyer’s have options in this market and would less likely be bidding on a property over its market value.
In a slower market, sellers should discuss with their real estate agent if this strategy makes sense for their home. Although the market may be slow, it doesn't mean the offer date strategy won’t work. For some properties that are turnkey, unique and in a sought-after area, this strategy might actually work if your pricing strategy is aggressive.
Pro Tips for Success
-
Work with your real estate agent to price strategically (list low vs. list market value)
-
Have a clear plan for pre-emptive (bully) offers
-
Market the offer date clearly in MLS and promotions
-
Set the stage for competitive interest: staging, photography, open houses
If you are looking to sell your home, we are happy to connect with you and come up with a strategic listing plan that will work for your property in today’s market!