How are all-cash offers affecting real estate?

A: When sellers accept an offer on their home, they are essentially taking it off the market. Even though they can accept back-up offers, many buyers are hesitant to write on a home that has a firstposition offer.

Therefore, sellers and their listing agent are putting all their faith in the accepted offer and that the buyer will follow through and close. Otherwise, the property has to go back on the market and they have lost valuable time.

An all-cash offer with no contingencies and a short escrow period plus the highest price is the ideal goal. Short of that, considerations are price offering, appraisal, loan and inspection contingencies and least amount of days to close.

In the current market, we are still seeing many all-cash offers and non-contingent loan offers, which often command a higher price because of the loan factor. Convincing a seller of the buyer’s ability to close will frequently be the deciding factor in our extremely fast-paced environment. Some sellers are bottom-line people who want to choose the numbers that pencil out best.

For buyers, my advice is to consult a professional Realtor who can guide you through the sometimes complicated process of becoming the chosen one. Put yourself in the seller’s shoes and ask how you would want the process to unfold — ultimately, it is probably one of the above scenarios.

Jill Gumina, Hill & Co. Real Estate, (415) 265-1717, jkgumina@gmail.com. A: Every seller dreams of a high, all cash offer that closes in one week. There is no need for an appraisal, no need to wait 25-30 days to close and no need to worry that the buyer’s circumstances may change in the interim. Because of the security an all cash offer brings to a transaction, it is not unusual for a seller to take such an offer at a price that is lower than that of someone who needs to get a bank loan.

However, sometimes all cash buyers think they will get a huge discount because they are all cash, and that is simply not the case. Since these days all buyers presenting an offer need to be pre-approved for a loan and show evidence of down payment, the buyer who needs a loan is not all that unusual. In fact, in evaluating San Francisco sold data for the fourth quarter of 2016 and the first quarter of 2017 for homes that closed at $1 million and up, with no maximum limit on the closed price, about 50 percent went to all cash buyers. That means that half of sales went to buyers who needed a loan.

Of course, the higher the down payment the more desirable the buyer because in a rising market with little inventory appraisals can be an issue, and that down payment is the buffer should the house not appraise out. Astrid Lacitis, Vanguard Properties, (415)

860-0765, astrid@vanguardsf.com. A: We are seeing less and less of all cash offers in the Bay Area, which is a good thing for the locals who are trying to compete with VA loans, Federal Housing Administration loans and even traditional conventional loans. As an agent who specializes in helping people find affordable housing in the Bay Area, it is a sign of relief.

When multiple offers come in on a house, the seller and their agent review them carefully. It is nice to see the locals back in the market again taking advantage of down payment assistance programs and traditional loans. All cash offers are disappearing or at least not always looked at as the most favorable next to a home buyer who is a teacher or community member with a strong loan approval letter.

So far this year, most of our multiple offer situations have been traditional home loan buyers with down payments of as much as 20 percent down. We are seeing more loan, appraisal and inspection contingencies, which protect the buyer and help them make better and more confident purchases.

Next step would be to see the home prices stabilize so more of our teachers, nurses, police, fire, and service industry people can buy homes locally.

Karin Cunningham, Berkshire Hathaway HomeServices Realty, (650) 438-3504, karinc@bhhscalreal.com.