What exactly does it mean when a property has “multiple offers,” and how should they be handled when selling your home?
A “multiple offer situation” simply means that your property has attracted more than one bona fide offer for purchase at the same time. Multiple offers become more common in a seller’s market, when the inventory of desirable homes can’t keep up with buyer demand.
As a seller receiving multiple offers, there are several ways you can respond and it is important to have a strategy. Different situations will dictate the best approach. Barker Group is here to guide you through the stressful, yet exciting process.
First, decide if one of the offers submitted is substantially better than the others. If the competing offers are similar, it may be best to go to all the buyers and ask them to submit their “highest and best” offer by a given deadline. Because (most of the time) buyers don’t know the terms of the other offers, this method puts the buyers in a bidding competition with one another, and has the potential of getting you the most desirable terms possible. But the “highest and best” method does have some risks. Some buyers may not want to bid against others, and may rescind their offer completely. Also, the “final and best” terms submitted at the deadline may not be enough for you, and most buyers will refuse to negotiate the terms of their “highest and best” offer any further. However, calling for “highest and best” offers DOES NOT obligate the seller to accept one of the offers if none meet expectations. It is your right to refuse all offers and remain on the market for another buyer.
If one of the offers is significantly better than the others, it may be more beneficial to disclose to that buyer the existence of the other offers, but choose to negotiate terms only with the best offer. The existence of other offers may motivate that buyer to accept your counter offer more quickly, before you abandon negotiations with him or her and move on to one of the others. However, if you choose this method of negotiating the multiple offers, you may never know just how much more the other buyers would have been willing to pay for your home. These are just two of many other options to consider when navigating multiple offer scenarios. When Barker Group represents you, we will discuss these and other possibilities that best fit your needs during your transaction.
Multiple offers are stressful yet exciting. If handled correctly, they are a great way to maximize your selling price and ensure you get the most desirable terms for your real estate sale. Let Barker Group be your guide the next time you need to sell your home.