Now before I imply that all the buyers I meet want to buy lots of house, let me explain. The Tri-Valley real estate market is fast-moving, and many buyers are feeling the pressure of little to choose from, lease renewals and fierce competition. Many buyers get frustrated when they’ve been beaten out in multiple-offer situations, by others with more all cash, higher prices and bigger down-payments.
Other times, the question arises when a buyer in contract on a short sale gets tired of waiting and wants to have a back-up plan in place.
With low inventory levels and high demand, this question gets asked repeatedly. So can you offer on more than one house? Well, it depends. Remember, a real estate purchase agreement is a binding contract, and must be made in good faith. Your signature on that document indicates that you have the financial wherewithal to make this purchase. It is accompanied by your earnest money deposit, also known as a ‘good faith deposit’ letting all parties know that you are ready, willing and able.
When You Can
If you are able to buy more than one property at a time, then you most certainly can do so. For an investor buyer, this may be the actual intention.
When you submit at offer that is declined by the seller, but you remain in back-up position. This means that the seller hasn’t signed your offer, but is working with another buyer. Your offer is not active, nor is it signed. If the current buyer is unable to perform, the seller will contact you first before putting the house back on the market. In all likelihood, you would re-submit your offer and make all dates current.
You can certainly submit on more than one property provided you are disclosing that fact to all parties (your agent, the seller’s agent and the sellers). However, most seller’s won’t be too excited about that prospect – they’ll be concerned that you may not have ‘staying power’ for the escrow.
When You Cannot
If you only have the money to buy one house, then you cannot write multiple contracts on various properties. I have heard of buyers and their agents doing this, but it is high risk. Real estate markets in general are small communities – agents know and talk with each other. If you do it, agents may be reluctant to accept any further offers from you. And if your agent does it, other agents will be suspicious of your intentions.
There are risks for you, and risks for your agent. A seller who gets wind of this if you don’t follow through could take legal action for breach of contract. Agents who write multiple offers for a single client without full disclosure could find themselves in front of an ethics panel.
So plan ahead, and try not to let the ups and downs of the market lead to desperate measures. There can be a hefty price to pay.