Increase our Offer for a Backup Offer?
Hi BP,
Here's a situation for ya...
We offered 470k for a house that was listed at $440k and we lost (welcome to the Denver RE market). The winning offer was 480k so we lost by 10k. The seller's agent told us we came in second place and that we would be their first call if the first offer fell through.
So our question is, should we submit a backup offer at 480k for the agent to keep on their desk if the other buyers back out? There are a handful of arguments to leave it the same 470 or increase to 480:
Stay at 470:
If the first offer drops then that technically makes us the highest bidder at 470k.
Who wants to spend 10k if they don't have to?
That is still 30k over asking!
Increase to 480:
Property would cashflow on day 1 which is rare in denver. So it's worth the extra 10k.
If the other buyer tries to negotiate price down the seller could let them walk if they have another equal offer of 480 on the table.
An extra 10k over 30 years is only about $45 per month against your cashflow.
I'm stuck on this and could use some input, thanks!
If you let the numbers decide:
Cashflow from 470 offer: +$75/mo
Cashflow from 480 offer: +$30/mo
...They're barely different