How To Manage Offers In Real Estate

Quickly and easily manage all of your real estate offers in one place.

In a housing market in the midst of a downturn, the offer stage of the home buying process has become critical. Every sale counts as real estate agents struggle to maintain production and if an offer is not handled correctly then it could easily fall through.

At Paperless Pipeline, we work closely with brokers and agents who are experiencing firsthand just how challenging this market can be. There are a number of factors contributing to the difficulties agents encounter, including increasing interest rates, a slow economy, and the end of the post-Covid property boom. In November 2022, the number of closed transactions among Paperless Pipeline users fell by more than 45% compared to the year before. And at the time, that number was increasing.

In such a challenging market, there has never been a more critical time to ensure you manage real estate offers in the most efficient way possible.

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What Is a Real Estate Offer?

A real estate offer, also known as a purchase offer, is the first formal communication between a buyer and seller that can ultimately lead to the final deal between the two parties.

An offer will contain the amount the buyer is willing to pay, any specific terms of the buyer, a target date for closing, how additional costs will be covered, contingencies, and the amount of earnest money deposit accompanying the offer—just to name a few.

After the offer is created and signed, it will usually be presented to the seller by the buyer’s agent, the seller’s agent, or by the two together.

If you are a real estate agent managing multiple offers at any given time, it’s important to have a process in place in order to stay organized, productive, and efficient.

Whether you’re a current customer of Paperless Pipeline, or a potential customer using a free trial, you can easily begin managing multiple offers—we’ll explain how later in the article.

First, let’s take a look at making an offer from the buyer’s point of view. This is an incredibly important thing for new real estate agents to understand if they are to act as buyer agents.

5 Steps to Make an Offer on a Property

You’ve helped your clients find their dream home. Now it’s time to make sure they get it. Here’s an overview of the offer stage of the home-buying process.

Choose how much to offer

Step one is to decide how much your clients are willing to pay for the property. This is where your real estate experience will be critical. Begin by thinking about the property’s value and your budget. Then take the following factors into consideration:

Pressure to sell: Is the seller under any pressure to sell the property? For example, has it been on the market for a long time? Is it being sold due to a divorce or because the owner needs to move out of town for a new job? If so, then you may be able to put in a lower offer. However, this cuts both ways. If the seller is under no pressure then they may be willing to wait for a favorable offer.

Similar properties: Perform a comparative market analysis to see how much properties in the area have sold for recently. This will help you gauge the level of interest in the property and advise your clients on how much to offer.

Property condition: Does the home require any repairs or renovations? If so, try estimate the cost of making them as accurately as possible. Your clients could factor this into their budget, ask for money off, or even ask the seller to make the necessary repairs as a concession of the sale.

Market conditions: If the current market is hot then your clients may have to offer above asking price to be considered. But if the market is slow then you may be able to offer the asking price or below.

Set contingencies

These are clauses in the sales contract that allow your clients to walk away from the deal without losing their earnest money deposit. They are based on things that need to happen for the sale to occur. For example, financing is a common contingency because the buyer needs to be able to exit the contract if they cannot get a mortgage loan to buy the property. Other common contingencies include: appraisals, home inspections, titles, and home sales.

Set earnest money deposit

This is a deposit that you make when buying a property using funds from a mortgage lender. It shows that your clients are serious about buying the property. This money is held in an escrow account until closing. Earnest money deposits are typically around 2% of the purchase price. Sometimes providing a higher amount can help get your offer accepted, as it shows the seller that your client has cash and can comfortably afford the purchase.

Write an offer

The offer letter is sent to the seller’s real estate agent and needs to include:

The address of the property
The name of your clients or anyone who will be on the title
How much your clients want to offer
A list of contingencies
A list of concessions
A list of items to be included in the sale
The earnest money deposit amount
Your clients’ mortgage loan approval letter
The expected closing date
The date your clients want to move in
A deadline for the seller to respond to your client’s offer

Negotiations

Once the seller receives your offer they will either:

Accept it
Reject it
Make a counteroffer

If the offer is rejected then your client is no longer considered a potential buyer. If the seller accepts it, then you move on to the closing process.

But if they make a counter offer, then you are in negotiations. It’s usually a good idea to contact the listing agent to understand what the seller wants and if they are willing to negotiate further.

Try to find out if there is any pressure to sell that you could leverage and remember that you don’t just need to negotiate the purchase price. For example, your client may be able to lift some concessions, pay some of the closing costs, or extend their moving-in date to make life easier for the seller.

Negotiations will eventually lead to your client’s offer either being accepted or rejected.

How To Manage Real Estate Offers with Purpose-Built Software

Now you understand what the offer process looks like, let’s look at how you can efficiently manage your workload when you are dealing with hundreds of them at once.

The most efficient option for a high-producing or experienced real estate agent looking to manage offers is to use software designed specifically for their industry.

With purpose-built software like Paperless Pipeline, you can quickly and easily create a transaction for your active buyers and have a central hub to store important documents such as offers, pre-approval letters, etc.

With Paperless Pipeline, you can organize all rejected offers in the view as what’s pending, or what’s been accepted.

Offers or other docs can be seamlessly emailed to through the Maildrop feature, saving you time that would otherwise be spent manually transferring documents to folders on your computer.

You can also use this transaction to store your client’s contact information, along with any notes specific to their wants, needs, or requirements throughout their home-buying journey. Additionally, you can stay on top of all of your to-dos by creating a custom checklist with relative due dates to ensure nothing falls through the cracks.

If you’re not currently using a transaction management software like Paperless Pipeline, there are still some excellent options for managing real estate offers through your personal tools or cloud-based storage systems.

How to Manage Real Estate Offers with Personal Tools

For a real estate agent who is just starting out, a great way to manage your real estate offers is through your own personal tools. One example of this could be your email platform, such as Gmail.

If communication with your client is already taking place via email, it may be helpful to create a folder within your Gmail account to store any rejected or accepted offers for that specific client.

A benefit of using personal tools (such as Gmail) is they are likely free or low-cost.

For higher-volume agents or offices, these tools will however make it quite challenging to scale efficiently.

How to Manage Real Estate Offers with Cloud-Based Storage Systems

Another option for managing your real estate offers is with cloud-based storage systems. Two examples of this include Google Drive and DropBox.

Within these systems, you could again create folders specific to your clients and their offers.

A helpful piece of advice is to stick with a standard file naming convention for all offers. An example of this could be LAST NAME_FIRST NAME_ADDRESS_DATE. This will allow you to quickly find the offer you need, without wasting time sifting through a bunch of files.

While a solution like this may work well for agents closing somewhere between one to two transactions per month, higher producing agents would undoubtedly benefit from a transaction management system built specifically for all of their real estate requirements.

Curious to see if a transaction management system like Paperless Pipeline will be the right solution for you? Put it to the test during a 14-day free trial and see just how simple it is to manage all of your real estate offers.