The Advantage of Deadlines
Placing time constraints on your offer is an often overlooked strategy. By limiting the time sellers have to consider your offer, you avoid an extended procrastination period that may cause an otherwise attractive deal to fall through.
People are motivated by deadlines. Sales, coupons, college applications, school papers all have deadlines. Deadlines create a sense of urgency and help us to overcome the complacency and procrastination we often feel with a big project. This same philosophy is true when negotiating to buy a house. A deadline will motivate the seller to review your offer in a timely manner.
Selling a home can cause anxiety and procrastination. For most people, home ownership is one of the largest financial transactions of their lifetime. Something of such magnitude is bound to cause some indecision. This is especially expected if the reason for selling is due to financial set-backs, health reasons or a change in life circumstances such as divorce. Their procrastination may have nothing to do with the specifics of your offer. A deadline will limit the time they have to get sidetracked by such emotions. You are forcing them to take action or risk losing a potential buyer.
How much time do you give the seller to consider your offer? Be reasonable but be firm. Typically, more than one person is involved in the decision-making, and it may take time to coordinate everyone. In many cases, giving them until midnight the day the offer is presented is reasonable.
Occasionally, the seller may be particularly hard to reach, such as in the case of a vacation or business trip. In such a circumstance 24 hours is reasonable. In today’s world of instantaneous communication, there should be no logical reason why it should take them longer than a day to decide. If they are serious, they will make themselves available.
Don’t be concerned that a strict deadline will cause the seller to reject your offer. You are simply motivating them to give it timely consideration. If they do reject it, it will at least save you spending any more time on this property.
Don’t be pressured by your agent into granting more time. Some agents fear it will offend the seller and increase the chance of rejection. Some may also not be confident with their negotiating skills and are uncomfortable imposing such pressure on a seller.
Don’t underestimate this strategy. The more time the seller spends contemplating your offer, the greater the chance a better deal may come along. A strict deadline minimizes the possibility of opposing bids.
You are committing yourself by extending the offer. Why should the seller not be expected to commit as well? A deadline will apply the pressure to help you get the deal you want.