Being involved in a multiple offer situation is great if you’re the listing agent. Concurrently with that comes the challenge of developing a system for your client to assist them in comparing offers. Multiple offers can be overwhelming for clients and if you have a way to categorize and breakdown offers that can be of great help. Additionally, if you develop a system that you use with multiple offers every time you are in a better position to rebut any suggestion that all offers were not presented in a given situation.
Currently the market has been boasting many multiple offer situations. Although its exciting for your sellers to have so many choices and may seem simple enough to choose the best offer, it is more of a complex process. One that you want to make sure you are fulfilling properly. Not only do you want to get your seller the highest price for their home, you want to in conjunction with the most favorable terms. Remember, every seller’s situation is different. Making sure to appease their needs is your number one priority.
Here we lay out some fundamental guidelines when handling multiple offers:
Presenting the offers
- Remember your duties as a listing agent are to your seller. As the Code of Ethics states “ you are required to protect and promote your client’s interests. That being said the Code requires your honesty amongst both parties.
- Explaining the various ways your seller can accept an offer. We explain the pros and cons of each below.
- Reminding your seller, as well as yourself that this is their decision and their decision alone. You are here to explain their options and give them advice but they ultimately decide which offer to go with.
- Prepare a form, spreadsheet or template to use to list the base terms of each offer: g. Price, Down Payment, Amount Financed, Closing. This will allow the client to see the scope of the different offers and to focus on special conditions that may affect their decision.
Negotiating strategies
Accept the “best” offer
Pro: You receive the most money for your seller
Con: To many, accepting the highest offer seems to be the given choice. Why wouldn’t you want to accept the most money? However, that isn’t necessarily the best option or choice for your sellers. You must be able to explain to them what each offer means and what they essentially will get out of it.
Invite other potential buyers who put in a offer to make their final and “best” offer
Pro: this could light a fire for buyers to realize that there are other strong offers on the table and they should highly consider changing their offer if they are truly interested.
Con: This may leave a bad taste in a potential buyers mouth and turn them away or even cause them to withdraw their offer leaving you with no offers at all.
Counter-offer
You can choose to counter offer one of the offers while you either set aside the others for the time being or reject the offers.
Pro: having the skill set to negotiate a deal can help your seller out tremendously
Con: If can waste precious time if the offer doesn’t end up being compromised and accepted. Or some of the other interested buyers may get tired of waiting and move onto another property.
Following these guidelines will help to create a systemized approach to presenting and explaining the various types of offers your sellers could be faced with.
The market is only heating up! Be sure you are managing the process of reviewing multiple offers with your sellers in the proper and most efficient way. Happy home selling!