"A Bird and 1/4 in the Hand" . . .

vs. Two in the Bush

There’s an old joke about two hikers who encounter a hungry grizzly bear. The first hiker thinks he has to out-run the bear. The second, smarter hiker knows that he has to outrun . . his hiking companion.

In a nutshell, that captures the dilemma facing buyers trying to decide how much to offer for a home.

After all the Comparative Market Analyses (“CMA’s”), number crunching, and buyer gut checks, the winning offer is . . . whatever is likely to trump the competition.

In a bidding war with multiple offers, that calculation is explicit. However, even when there is only one Buyer on the scene at any given time — the typical case — that Buyer must still guess the minimum the Seller will accept, vs. waiting for another, better offer.

A bird in the hand vs. two in the bush is a toss-up. So, my counsel to Buyers is to try to offer a bird and one-quarter or a bird and one-half — that is, make the offer tempting enough that the incremental amount that the Seller might hope to get by waiting isn’t worth the risk.

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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