How to Effectively Negotiate Multiple Offers

How to Effectively Negotiate Multiple Offers

What happens if you are fortunate to receive an overwhelming number of offers?

The way an offer is presented, if it is well-organized and complete, can have a big impact on whether or not the homeowner accepts one offer over the others. Some of the considerations before deciding which offer to accept and which offers should be “back up” are:

• Initial Deposit and Proof of funds – How much money is the buyer willing to deposit compared to other buyers and do they have more than enough funds to purchase the home and pay for all closing costs?

• Buyer’s agents should be proactive about communication with the listing agent rather than submitting an offer and waiting for a response.

• What is the Seller’s ideal timeline to be completely out of the home, i.e., specific timeframe or date certain? If so, then a sale-leaseback might be extremely advantageous and create far less stress!

• Sale-Leaseback: Does the seller need more time to identify a new home and physically move all items from the home? Is the seller willing to stay in the home for a specific period of time after the transaction is closed? Many buyers will be agreeable to offer a sale-leaseback to the homeowner as a way to present the winning offer.

• Property Condition Report – If property condition is an issue, know whether the sellers are looking for an “as-is” offer and willing to price the home accordingly. Many affordable fixer-uppers are experiencing the most intense bidding wars.

• Privacy – If a homeowner prefers privacy and safety, selling a home off-market is a great way to satisfy the homeowner’s needs while minimizing unnecessary traffic through the home. The primary disadvantage to this approach is potentially losing out on all of the buyers who will not see the home because it is not listed on the Multiple Listing Service (MLS). And remember that all listings that are marketed to other agents or buyers-including pocket listings, may need to be placed in the MLS, according to the National Association of REALTORS” Clear Cooperation policy. The MLS should have specific rules to explain how off-market policy works.

Prepare for the Unexpected

Flexibility is key in a bidding war. In an intense competition between the various buyers and sellers can surprise you by changing their priorities midstream. Many homeowners may not even know what their bottom line is until they weigh all of the options. Part of the real estate pro’s job is to lay out all offers that make sense for your clients’ goals, guide them with your expertise, and accept the decision they make.