January 21, 2015
How to Make Blind Offers on Houses
When a buyer submits a purchase contract to buy a house without visiting the property, it is considered a blind offer.
In order to leverage time and get multiple properties under contract, real estate investors like to make blind offers on houses listed for sale on the MLS.
Find an Investor Friendly Realtor
In order to make blind offers on multiple properties, you will need an investor friendly real estate agent. Many agents will not make blind offers for investors.
Most buyer’s agents are trained to show houses to owner occupant home buyers who will usually visit about a half dozen homes before an offer to purchase is prepared and submitted to the listing agent representing the seller.
The idea of preparing purchase contracts to submit blind offers for a buyer who has never seen a property seems absurd to most Realtors.
This is why you must find an investor friendly Realtor who will work with you as an investor. And if you are out of town, you must find an agent who is comfortable representing you without ever meeting you.
The most likely agent who will understand the services you need as an investor is probably the agent who is also an active investor, or has been an investor sometime in the past.
Screen and Select Properties
Investors who are successful in getting properties under contract understand property values in their target market. And they look at hundreds of listings that may match their investment criteria to screen out the ones on which they want to make offers.
Screening and selecting houses to make offers on involves selecting the locations, looking at the pictures, and reading the property description in the listing.
The investor then gives the offer price to their agent who will prepare the purchase contract which will include other terms in the offer, such as due diligence period, closing date, and the amount of the earnest money deposit.
The time taken by the investor buyer to screen the property and decide on an offer amount makes the blind offer better than arbitrarily selecting an offer price based on a mathematical calculation of the listing price.
Sign and Send the Purchase Offer Contract
After the investor has signed the offer, which can be done with an electronic signature in most cases, the agent will send the offer to the listing agent to be presented to the seller.
Your agent should follow up with the seller’s agent to confirm that the offer has been received and presented to the seller.
Make Offers on Multiple Properties
Most investors will find that they will need to make offers on multiple properties in order to get one under contract. Depending on how many houses you plan to buy, you may have to continuously make offers daily or weekly in order to close on the number of transactions that meet your investment goals.
If you make over 100 offers you should expect to get between 8% and 15% to get under contract. If you don’t get at least 8 properties under contract after making 100 offers, you may need to revisit the numbers and housing values in your target market to see if you can increase the purchase price of your offers and still meet your investment goals.
John Marion and Sandra Watkins are investor friendly agents who make multiple blind offers for investors.
Call or text John Marion at 703-371-9548 or Sandra Watkins at 770-324-3680.