Are “Offers Due By” Deadlines on Their Way Out?
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In the height of the 2021 real estate market, it seemed every other listing that went live on Thursday would have an “offers due by” note that put the pressure on buyers. Potential buyers needed to make time to get to the open house on its first weekend (or grab an appointment in an already packed showing schedule) and, if they liked the place, have their finances in order to submit an offer by midday Tuesday.
If you weren’t ready to figure out in just a day or two whether you could afford a 20 percent down payment, or if the mortgage was realistic for your budget, forget it. The clock was already ticking.
But what does that look like now that mortgage rates are rising? Are real estate agents still driving prospective buyers to make an offer ASAP? Here’s what three agents had to say about the “offers due by” deadline often attached to listings.
“Offers Due By” adds unnecessary stress.
“Just like skinny jeans, bullish deadlines are not so popular in today’s world,” says Vickey Barron, a real estate broker with Compass. She notes that it never feels good for a buyer to feel like they’re under pressure to make an offer before they’re ready, and these deadlines do little more than cause unnecessary stress.
She recommends avoiding deadlines whenever possible, especially since buyers are now more likely to sit on the bench and wait to see what else comes up. “One could blame that bench on higher interest rates,” she says. “Those rates don’t stop the game of buying and selling, but it is changing the behavior.” That includes how buyers respond to arbitrary deadlines to get in an offer.
“Offers Due By” creates an even playing field.
On the flip side, Rachel King, real estate broker and cofounder of SERHANT, reports that she consistently implements due dates for offers, particularly on properties that she knows will generate significant interest in their first weekend — and that’s not dropping off, even as mortgage rates rise.
“In listings that experience high demand, ‘offers due by’ ensures that all interested parties have an equitable opportunity to table their offers, preventing any potential buyers from being left out,” says King. As long as you’re prepared with a pre-approval and the ability to make an offer quickly, a deadline can guarantee you have an opportunity to make an offer before someone else scoops it up.
Either way, low inventory is still driving demand.
Nicole Beauchamp, a real estate advisor and broker at Engel & V?lkers, explains that in theory, the rising interest rates should be driving fewer “offers due by” situations, where a seller believes they can drive demand. But that’s not necessarily how it’s playing out in the market.
“If a property is in a prime location, well priced, and is in move-in ready condition, all of these things propel it to being much more desirable,” says Beauchamp. She explains that inventory is still in crisis in many segments of the market, and sellers can use these artificial deadlines to create even more urgency.
“It’s a conundrum impacting affordability and making some feel like they are stuck on a hamster wheel,” she says.
Regardless of a deadline or lack thereof, Beauchamp advises her clients to submit their offer as soon as they are ready to make a complete bid. Even if there is a deadline, that doesn’t mean a seller won’t accept a good offer ahead of the due date.
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