Should a Buyer See a Property That Already Has Offers?

Sometimes a buyer will want to eliminate a showing if a property already has offers on the table. I typically don't recommend ruling properties out because of active offers, but there are some exceptions & other information that's helpful to know.

General Information To Note:

Generally, the more cash you have available, the better your position will be in a multiple-offer scenario.

Besides offer price, some of the other most important items (listed as such by a column of “importance”) are helped by having cash (whether for the offer itself or cash to support your loan/offer), such as not requesting closing cost assistance from the seller, not being appraisal contingent, & having a guarantee above appraisal if the home is contingent on appraisal. That said, offer price is still the most important element of an offer, so even if you are doing an offer that doesn’t have an above appraisal guarantee, the seller may still accept in a multiple offer scenario, and above appraisal guarantees or offers not contingent on appraisal don’t always win in a multiple offer situation. The other terms definitely matter. For instance, if you are using a loan and can’t afford an above appraisal guarantee, & a competing cash buyer not requesting closing cost assistance and not requiring an appraisal isn’t also doing the seller’s ideal closing date or a rent back to the seller who has requested it and has a long home inspection time frame, not wanting do make an offer as is, if you are more flexible in those other areas despite requiring an appraisal, it’s possible that your offer will win, especially if your purchase price is >2% above that other offer.

The lower the number of offers, and the longer that a property has been on the market at the current list price, the less that a multiple offer situation is likely to be very competitive.

I’ve seen where a buyer made an offer below asking price on a home with an escalation to a higher amount in a multiple offer situation for a home that had been on the market a long time where the sellers took our offer, the escalation clause was not activated, and the sellers were even willing to reduce the price further following a home inspection finding structural problems. Conversely, I’ve seen where a property that just hit the market went from no active offers when I initially asked about competing offers to a few offers by the time that I asked again before we submitted to having 6 active offers by the time the seller responded to our offer.

Agents often won’t disclose much about an offer (or the highest offer) on the table prior to a showing or even after the showing.

While asking the agent about the offer is ok, some agents will respond by saying it “wouldn’t be fair” to tell me anything about the offer or the specific terms without telling all agents. Personally I like to disclose numerous terms to agents representing buyers considering a property in a multiple offer situation where I am representing the seller, although I don’t know of any other agent who discloses as many terms as I do in competing offer scenarios. I’ve seen where offers can go far above asking price and keep getting better by doing it the way that I do it, but most agents have a more old school approach and request “highest & best”

Exceptions Examples:

If >1 offer already (or if 1 offer known to be above asking price) & at literal 100% top of budget with no option to stretch

An exception would be if there are multiple offers, the property is already at the 100% top of your preapproval (or proof of funds if buying in cash), and you have no way of stretching the preapproval with your lender or with your own (i.e. taking principal out of a Roth IRA to add to a down payment, though keep in mind I’m not an attorney or CPA & am thereby providing an unprofessional opinion there) or other’s finances (i.e. gift funds). In a case like that, especially if the home is distant from your home, it may not be worth it to even see it.

That said, even then, there are exceptions.

A cash offer at list price could be superior to another offer. I've seen where I recommended to a seller to accept a cash offer at list price even though it had a home inspection contingency and even though we had another offer that was above list price but that was using a VA loan.

Also, a conventional offer at list price for a home that needs work could be superior to a VA or even an FHA offer above list price due to stricter appraisal guidelines on repairs.

If >1 offer already (or if 1 offer known to be above asking price) & you wouldn't be willing or able to make a strong offer

For instance, if your offer would be home sale contingent, your offer would be inherently weakened, and would need significant compensating factors to tip the balance in your favor (i.e. if your home was already under contract with no contingencies remaining, you made an above asking price offer, had a strong earnest money deposit, optimal closing date, etc.)

Related:

Backup Offers: Seeing Property & Making Offers After Already Under Contract