Backup Offers in a HOT Market
It’s no secret that Asheville and surrounding counties are experiencing a strong seller’s market. While it’s cooled off very slightly the last two months, we still have less than 2 months inventory. Homes are selling for 18-20% over what they were a year ago. Sellers are getting an average of over 99% of their asking price, and the average days on the market are less than 30! Yet even in this competitive environment, almost 25% of all contracts fall through before closing. Surprises during home inspections, appraisals and buyers’ cold feet are just a few of the reasons. A wise selling strategy during this time of multiple offers is to negotiate a strong back-up contract into place.
4 Things Sellers Need to Know about the Benefits of Backup Offers
As you consider the benefits of backup offers, here are 4 things you need to know:
- A Backup Offer Is Legally Binding – A backup offer is a fully executed offer, just like the original, so make sure the terms are acceptable. Typically, the buyer will include a contingency in the event they find another home. An experienced local Realtor from Asheville Realty Group will help you navigate and understand the terms of the Backup Addendum.
- Multiple Backup Offers – In a strong seller’s market, it is not unusual to accept multiple backup offers. Always clarify the position of each backup offer in writing. Communication is always key in a real estate transaction, and this is no exception.
- Leverage – Backup offers provide extra leverage during the due diligence period as well as security for the seller. Use backup offers to discourage unreasonable requests for repairs or concessions during due diligence.
- Earnest Money – The North Carolina Backup Contract Addendum does require an earnest money deposit from the buyer to be held in escrow, even while in backup position. However, it’s usually less than a normal earnest money amount, with additional earnest money due upon moving into primary contract position. Due diligence fees are not required until the backup moves to primary condition.
Backup offers can be an important consideration in any home sale, especially in this hot seller’s market.
About Asheville Realty Group
Asheville Realty Group is a boutique brokerage firm offering full-service real estate services. We have locally experienced agents who specialize in residential homes, luxury homes, investment properties, country-side acreage and everything in between. We love Asheville and the surrounding western North Carolina mountain communities that we call home!
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