The Two Best Weeks to Make an Offer on a House

16

This is it.

The time is now.

Don’t miss it.

December 3rd to December 14th, 2012 is your time to make lower than usual offers. If you can get your bids in by December 14th, you still have time to inspect, check title and close by December 31st. At this time of year, the banks are anxious to get their extra inventory off their books. If you can make cash offers, many banks will come down in price if you can close ASAP.

Another good thing is that most end users and investors are distracted and really busy with end of the year job projects, holiday plans and gifts to buy. So if you can spare the time to up your number of bids in the next two weeks, do it.

When making end of the year offers, there a number of strategies you can use to ensure successful closings.

Six Tips for Making Offers At the End of the Year

  1. Come up with a game plan to carve out time to look at the numbers, visit properties and make offers in the midst of all the other December pulls on your time.
  2. Make cash offers only. Get partners if you need to, but cash offers is what makes a difference to banks in December.
  3. Close by December 31, 2012.
  4. Keep you inspection period short if you can. I make 5 day inspection periods, but you need to be able to sleep at night so do what’s right for you.
  5. Reoffer on bids that were rejected earlier in the year.
  6. Plan ahead. Put a reminder on your phone or calendar for next November to start considering your December 2013 bids.

By the way, I kept this blog short because, guess what?

I’m busy out making bids.

Leave me a comment below and let me know your goals and plans for the next two weeks!

Photo: John Morgan

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About Author

McKellar Newsom invests in single family properties in seven different markets. McKellar partners with investors who don't have time to devote to real estate investing.

16 Comments

    • McKellar Newsom on

      Hi Brandon,

      I’m glad I could help motivate you! Did you get inside the house? Did you make an offer? If you wait until late December, it’ll be hard to close by December 31st. Thanks. mck

    • McKellar Newsom on

      Hi Ryan,
      Thanks for the comment! How are things going out in Akron these days? Are investors trying to buy before the year end? Are the banks accepting lower offers? How is the real estate market there in general? Thanks. mck

  1. Love it, love it, love it. 10 offers in the past 2 days…..it’s all a numbers game right? I have also been seeing MASSIVE price drops in the last couple of weeks with properties that have been on my radar for the past 6 months going under deposit after some massive bidding wars – mostly going to Owner Occupants who now see the new price drop as their way of “justifying” all the work that has to be done to their future “dream home”.

    • McKellar Newsom on

      Hi Suzy,

      Great to hear that you are bidding like crazy. Did you land any deals already?

      I agree that it’s a numbers game. The more offers you have out there the greater chance of landing one.

      You have seen massive price drops? Where are you located? We have had some price dropping but I wish it were massive. Thanks. mck

  2. Good tip, made me think of this though

    Many companies fiscal years don’t end on 12-31

    a quick way to determine a company’s fiscal year is to bring up a stock quote for the company and to choose to view its annual income statement. The heading for the statement will usually show the last business day of fiscal year over which its income is being reported.

    Not sure if this will be helpful or not, depends on the bank that owns the house.

    Another thing is that most companies also care about their quarterly performance, which is announced as news and affects stock price, therefore probably affects orders from the top, so if you can see when their quarters land, this may be able to help you as well in some situations.

    • McKellar Newsom on

      Hi Jason,

      Good point about fiscal year ends. It would be great actually to have a list of the major banks and their fiscal year ends. You could target those banks 1-2 months before their particular year end.

      I have certain banks that I see dumping properties more than others. I’ll check on their fiscal year ends first. Great comment. Thanks. mck

  3. Note that this probably won’t work with Fannie Mae properties (though you never know, try it!). They play by their own rules, usually keep dropping the price weekly, monthly, etc. til someone buys it for that price. I know they’re supposedly private, but they seem to act like a govt agency, and don’t care about quarters ending or revenue projections, they’re happy to hold it for years if need be. I’ve bought some that way recently, for half or less of original list price, months or even years after originally listing it..

    • McKellar Newsom on

      Good point. I don’t think HUDs care as much about quarters and year ends either.

      When you say you bought some “that way recently”, do you mean waiting out for the price to drop?

      There is definitely a correlation between waiting and return. Thanks. mck

  4. Great article. Near the end of November, there was a fresh to the market bank REO six-unit that I had offered 62% of list price, which they countered with 89% of list price, and the agent firmly insisted I’d never be able to get them down any more. I re-countered with my original 62% and walked away.

    On Dec 13, I read this article while at my day job, and thought, “WHY NOT?” I immediately called called the list agent up and said, hey, I’ll bump my offer up to 68% of list price cash no contingencies, and we can close by the 28th so the bank can get it off their books this year yet. If they’ll do it, we’ll get the paperwork done today. He still insisted they wouldn’t come down lower than 89%, but agreed to call them with my verbal offer (small local bank). 15 minutes later we had a verbal agreeement, and two hours later we had buyer and seller signed purchase agreement, for 68% of original list price after only 3 weeks on the market. It worked! We closed on the 28th, and the existing tenants seem on board with a 40% rent increase.

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