The Secret Formula to Writing a Winning Offer

It’s a tale home buyers in San Francisco tell all too often.

“The real estate market in San Francisco is crazy! After months of searching, we bid on the perfect house, only to find out there were 15 other bids and we didn’t even crack the top 10! Being the winning offer in this town is next to impossible.”

Fear not! I’m here to tell you, it IS possible. My clients’ offers win, sometimes even when they aren’t the highest in price. Sometimes they win with loans against cash offers.

What? Impossible, you say. So, what’s the secret to a winning offer that beats the competition in the San Francisco real estate market?

Spoiler alert, there isn’t one.

While there’s no exact formula for writing the offer that is guaranteed to seal the deal, there are proven strategies I use to give my clients an edge in buying a home when competition is strong.

1.  Relationships matter

My reputation in the San Francisco real estate market gets my clients a seat at the table, even if we’re not the top offer in terms of price. Being known as a trustworthy, hard-working, and detail-oriented professional who gets deals closed on time benefits my clients.

If I don’t already know the listing agent, I will get to know them so we can work together on a deal that works for everyone.

2.  It’s all in the details

Cross your T’s, dot your I’s, and make sure the offer is well packaged and presented. I often tell my buyers, if you’re spending $1.5M on buying a home, the least I can do is present an impeccable offer on your behalf.

Put it this way: if you’re taking me out for a meal at a five-star restaurant, I’m not showing up in flip-flops.

That said, a seller isn’t going to leave $50K on the table. But I have been told that my buyers won because of the way the offer was presented, the terms in the offer, or even how my buyers represented themselves in their buyer “love letter” (more about that below). 

In this competitive real estate market, a clear and professionally prepared offer stands out.

3.  No (or few) strings attached

One strategy in a competitive situation is to waive as many contingencies as you can, within reason. However, I never advise my buyers to purchase a house if there aren’t inspections in place from a reputable inspector or if key disclosures aren’t available.

If inspections are not completed, an inspection contingency is a must-have. In addition, if you include an inspection contingency with your offer, keep the time period as short as possible, no more than a week. If feasible, consider waiving the two other major contingencies that you have control over (loan and appraisal).

Most sellers will go with an offer that has few to no contingencies. If needed, temper a contingency with other attractive terms; upping the price is a good way to win. Another strategy is to give the seller the gift of time, if requested, with a free rent back to sweeten the deal.

3. Seek approval

With cash offers to compete against, loan underwriting is essential when buying a home. If you are underwritten for your loan, you are, in the eyes of a seller, practically as good as cash. It’s worth noting that while cash offers can close in as soon as a week, good lenders can close with a loan in about two weeks.

There can be some hold-ups if you are purchasing a condo. I encourage my condo buyers to work with banks that offer a streamlined condo approval process.

4. Cash isn’t always king

If you can make a cash offer, it will often win against comparable offers. Generally, this is the case, but it’s not a guaranteed win. I have won numerous times with loans against cash offers.

Bottom line, your offer has to be clean, strong, and show that you will get the deal done. While sellers are looking to maximize their return, they also want a deal that closes quickly and easily.

5.  Know when to fold ‘em

If you receive a counter offer or multiple counter offer, you should be prepared and know your maximum budget. I may ask if you can stretch a little to grab the perfect home, but you should stay in the realm of neighborhood comparables and never go beyond your comfort zone. Also, be prepared to respond promptly if the seller wants an answer right away!

Overall, my goal is to get you in a home you love, without you overpaying or breaking your bank. If you know your budget and limit before you get into the offer process, you can act quickly and with confidence.

6.  Get personal

Writing a personal letter may not work for all sellers, especially investors or trust sales, but it may tip the scales in your favor. Sometimes you can make a personal connection just by sharing a bit about who you are and why you love the house.

I provide my clients with examples of buyer “love letters” to help inspire them. As always, know your audience and write a letter from the heart that speaks directly to them.

While being the winning offer in a competitive market can seem daunting, with the right guidance, strategy, and support from a top agent (ahem, me!), the seemingly impossible becomes possible.

Then you can tell the tale of the bid that beat them all, to the amazement and delight of your friends and family.