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Modern House


The ONLY Way To Get A Home In Michigan!

You NEED these 5 tips if you’re going to buy a home in Michigan, so be sure to stick around, so you can ACTUALLY get your offer accepted.

This housing market is stressful, I think my hair is slowly turning gray, and I’m sure yours is too as a buyer trying to jump onto this 20 mph treadmill (we call the housing market) flat footed. I’ve been getting several texts, emails and direct messages on social media from people all over the country wondering what it takes to get your offer accepted in Michigan’s housing market today, so I have compiled 5 tips or strategies you could say that can get your offers accepted, because it’s been working for my client when used correctly. And before I jump into it, these strategies are used when you’re in multiple offer scenarios, not necessarily when a homes been on the market awhile or just isn’t getting much traffic at all. This is for that home that people would die for, the line out the door that has buyers discouraged before they even step foot in the place, so keep that in mind as a move these strategies.


Kicking this list off with the number one strategy to getting your offer accepted today, and that’s the use of an appraisal guarantee. This is very important to understand so I’m going to spend a few extra minutes on it. An appraisal guarantee is verbiage that’s been utilized infrequently over the last decade until we faced the housing market during and after the pandemic. For those of you that don’t know what an appraisal or appraiser is, this is an individual that’s sent out to put a value on a home based on comparable home sales and features. This individual has a lot of power in their hands, as the value they come up with becomes what a mortgage lender is willing to give you to purchase a home. For example, let’s say you put an offer in on a $200,000 home, but this appraiser person came out and said on their detailed report that it’s worth $190,000. At that point, that’s all a buyer obtaining a mortgage is able to purchase this home for. So in a perfect world, the seller would drop the price $10,000 and proceed with the process, otherwise, the buyer wouldn’t be able to purchase it, because they don’t have the funds to do so.

In a not so perfect world, Mr. Appraisal guarantee shows its ugly face in the room. With offers on homes going a ridiculous amount over asking price, sellers are wanting a “guarantee” that what you are offering is supported. So let’s break this down. Let’s say on that same $200,000 home, there’s 5 offers on the table and the best offer gets accepted for $215,000. Since the home appraised for $190,000 based on the example I broke down earlier, you’d be essentially paying $25,000 over the market value. So on top of your closing costs and down payment, if there is an appraisal deficiency in any way, sellers are wanting buyers to cover it. In this example if you had a 100% guarantee, you’d be paying an extra $25,000 out of pocket, which states that if the appraisal comes in less than your offer price, you agree to pay some cash out of pocket to lessen the gap up to your purchase price and not to exceed it, but keep in mind it doesn’t have to be 100%. You could pay $5,000 or even $2,500, whatever would make that offer look more appealing, there’s a misconception that you need to cover that gap completely, but you don’t.

I will say however, sellers will lean more toward those offers, unless your agent is able to provide some comparable sales in the area and say, okay look, your house is priced at $300,000, I want to offer $350,000, but I will only guarantee $10,000 (instead of the expected $50,000) because there’s a home like yours in the neighborhood that sold for $340,000, so we believe it will appraise at that higher value. You might be sitting back thinking, why is something like this even part of the homebuying process? And I feel you, but think about it for a second, knowing that an appraiser holds the power to determine the home value and how much a lender is willing to give you to buy that home, what’s stopping you from offering a million dollars on a $200,000 home? That will by far beat out any offer right? But you and I both know that the appraisal on that same home is $190,000. So there’s absolutely no benefit to a seller accepting that offer unless you can promise to have some money to back that up.

I’ll do another example before I switch to the next strategy.

There’s 2 offers on this $200,000 home, offer #1 is $250,000 with no guarantee and offer #2 is $205,000 with a $5,000 guarantee, which one would you pick? The first one obviously, kidding I was just making sure you’re paying attention. Assuming this is the same home that appraised for $190,000, the first offer would simply revert back to $190,000 since they didn’t guarantee squat and the second offer would come out to $195,000, so that’s why guarantees are important and why price isn’t everything to a seller when sifting through offers. The one caveat to this example is you don’t know the home's appraised value before you offer on the home, and that’s where this next strategy comes into play.


The good ole escalation clause, you may have heard about it, you may have not, but this clause will often work in unison with the appraisal guarantee depending on the offer situation. An escalation clause is a safety net, but a lot of sellers and listing agents don’t want to deal with them and I’ll tell you why in a second. The verbiage for this clause in a contract would be something like, “Buyer agrees to increase their offer by $5,000 increments up to a max purchase price of $250,000 with offer proof.” As a buyer in this market or any market for that matter, there’s always the concern when getting into a multiple offer scenario, if you’re actually offering the right amount or if you’re just way out in left field. When people think multiple offer scenario, they assume the offers are getting 25-50K over asking price on your average priced home, but it could’ve just went 5-10K over and if you’re dead set on offering $50K over when the next highest offer is only $5K, that would suck, and that’s where the escalation clause comes in at. Based on the verbiage I used earlier, you’d just be increasing your offer $5,000 more than the next highest offer, instead of just throwing your offer out there and hoping it’s not too high.

You might be wondering, why $5,000? Well, that goes back to sellers and listing agents not wanting to deal with them, because as a listing agent, your phone is getting blown up 24/7 you’re trying to keep track of every offer, and this clause adds an extra step, because you’d be essentially having them battle back to back. For example, I had listed a home for an investor client of mine and 2 offers came in with escalation clauses, so I was back and forth with the buyers agents of each of the offers saying “well they increased their offer to this” then calling the other one and saying, okay they went this high. It just becomes this car auction in a sense without the fast rambling voices. We drove the price extremely high, and since I listed the home, my job was to get the seller a ton of money which is exactly what I’m supposed to do, so in my opinion, if your agent says no to escalation clauses, they are just being lazy. People will say, just offer your highest and best instead of giving people the opportunity to use escalation clauses, and in my opinion again, cutting that clause out increases buyers remorse and the possibility of someone backing out since they feel like they are spending too much money, because they have no idea what the other offers went for. Using an escalation clause gives you that “in” in a sense because at the end of my verbiage I say “with offer proof”, which means I need to physically see this other offer in order for us to agree to escalating. Without offering proof, you’d just be taking someone’s word who’s working in the best interests of the seller, which wouldn’t be good.

To answer the question about why $5,000, the higher that increment is, the more likely the listing agent will agree to the clause, because if you are just increasing the offer $1,000 at a time, they aren’t going to play that back and forth game nickel and diming until everyone reaches an end. These clauses can be easy to use though especially when agents do what I did and put a cap on the increments. Some people keep it open ended and that’s just asking for a disaster. You could be assuming it will just go $25k over, but one of the offers was a lotto winner who will escalate $100K over asking, so do yourself a favor and cap that off, your wallet will thank you.


Those are 2 of the biggest strategies to getting your offer accepted today, the rest can also be used in unison, but act as a secondary incentive for your offer to be accepted when there’s a few that are relatively competitive with one another. The next strategy is free post close occupancy. So as a buyer in the trenches right now, you understand the hardship of getting your offer accepted, maybe you’ve had 5 offers denied already. Take that stress and add trying to sell a house at the same time. I know these sellers feel like monsters, but I pinky promise they are humans too, they are just trying to get the funds they need to buy the next home. Post close occupancy gives a seller a safety net, in case there are any delays or complications on their home purchase, or maybe they just need some extra time to pack up their home. Most home sellers are asking for 30-60 days of post close occupancy, which means that when you close on a home as a buyer, the seller gets to stay in it for the next 30-60 days. In a perfect world, if a seller needs some occupancy, they would pay for their time staying in the home, and that would be the cost of YOUR mortgage, not theirs, so they would be paying more money to live in the same house. This is often referred to as a rent back, because the seller is renting the home back from you for a certain period of time. If a couple offers are close, some people will tack on free post close occupancy, and this just truly depends on what a seller values, so always chatting with the agent prior to submitting an offer and asking. What is your seller looking for in an offer? What do they value? Becomes a good outline for an offer. Let’s say they have 3 kids and the home is just jam packed with toys and everything else. I bet they’d appreciate being able to stay in the home for free instead of having one more bill to worry about while they transition into another home. So that one month of a mortgage payment may be the differentiating factor on whether or not you get an offer accepted.


Moving along to strategy number for we having the waiving of a home inspection. When a seller gets a lot of offers in hand, their deciding factor tends to be an offer with less contingencies, and if you don’t know what a contingency is, in simple terms it’s something that allows you to back out of a home purchase without any repercussions. So a home inspection is a contingency, an appraisal is a contingency, the ability to obtain financing is also a contingency, so if you’re someone who’s paying all cash, you just removed the financing contingency, as well as the appraisal contingency, so that’s a lot less stress on a sellers shoulders, and that’s why sellers will accept a lower all cash offer even if there’s an offer higher with a mortgage. There’s just too many “what if’s” in play when it comes to contingencies. Since most people can’t just dish out an all cash offer to remove contingencies, they do the next best thing, waive a home inspection. Offers today are known to waive a home inspection completely so you won't (as a buyer) just nitpick the seller’s home to try and dwindle down the price. Let’s say your offer one and you offered $50K over asking price, maybe you had time to sleep on it a little bit and you’re thinking you bit off more than you could chew, but you still love the house, you could make it a point to say, well based on the inspection report it needs a new roof, furnace, AC unit, and garage door, so let’s take $50,000 off the purchase price to satisfy that. For one, the seller will just laugh at you and accept the next offer, but waiving the inspection completely gives them that peace of mind that no matter what the findings are during the inspection, you can’t use it to negotiate.

Before you jump in the comments and say Andrew, why would you ever recommend someone waive their home inspection? And I don’t actually, but this is what the competition is doing. I tell people to do a pass/fail inspection. You are either content with the findings of the home inspection or you’re not, and in that case you back out and keep looking. It just lets the seller know, okay this buyer isn’t just going to nickel and dime me, but what’s pretty cool about this strategy is even when there is a pass/fail in place, if something unknown pops up that the seller never knew about, there’s often this guilty feeling and they agree to have a conversation about it, so in a sense this verbiage doesn’t actually do anything, but it does let the sellers know you’re not going to tweak out about a busted up outlet cover.


The last strategy is one that is not often utilized, but I always make a point of doing so and that’s adding a personal touch. Like I said, sellers might seem like monsters, but they are human beings too. Of course they’d like to make as much money as possible off the sale of their home, but they can still feel for you and your situation at the same time. You ever hear those homeowners who say, I just want to give this home full of memories to a great family, the fair housing act would call this discrimination, but they are probably not Realtors, so they can sell their home to whoever they want to. Adding personal touches could be doing a buyer letter that shows the seller your personality a little bit, along with some things you love about the home. Keep in mind, some listing agents accept these and others do not because they believe there is a conflict of discrimination, so they just steer clear of it altogether, but if they aren’t making the decision on the offer to accept solely on the fact a potential buyer put a picture of their family on the letter, then there truly isn’t any harm. Just something to keep in mind. Another thing I do to add a personal touch, is I’m very observant in a home when I view it with a client, I get a good idea of their personality, their hobbies and their interests, and I’ll often times give a free gift card up to a certain amount to the seller and say something along the line of, I know the housing market is stressful, so we figured we would treat you to a dinner at a brewery because we noticed your growler collection in the basement and we thought you could have a nice evening in your town before you move. I also consider myself as somewhat of a strapping young lad, so I have offered free moving services from yours truly to help the sellers move out of their home. I figured if I could help move a dresser or two, save them a little money with movers, they may appreciate it.

I want to state again that these strategies are used in multiple offer scenarios. If there’s a home that has a few offers on it, you could consider doing one of these last few strategies instead of the guarantee or escalation clause, and if the home has been sitting on the market for 10, 15 or 20+ days, don’t feel the need to offer at asking price, because in today’s housing market, when a home is priced right it can sell in 3-5 days.

If you need any help buying, selling or investing in the great state of Michigan, please don't hesitate to reach out and I would be happy to be your go to resource.



Andrew McManamon is a Michigan REALTOR® with Signature Sotheby’s International Realty and provides real estate services to Buyers, Sellers and Investors throughout SE Michigan including Livingston County, Oakland County, Washtenaw County, Genesee County & beyond. Andrew has become one of the rising stars of Michigan real estate agents. Prior to his real estate career Andrew was responsible for managing a senior living facility in Brighton, Michigan as a dining supervisor and an activities assistant. Andrew’s passion to help people is unlike any other, and he continues to strive to be best resource he can be. Andrew graduated from Cleary University in Howell, Michigan with a double major and currently resides in Brighton, Michigan.


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