Multiple Offer Negotiations: Guidelines for the HOT Austin Market
Perhaps no situation facing buyers and sellers in the hot Austin real estate market is more frustrating, or fraught with the potential for misunderstanding or missed opportunity, than presenting and negotiating multiple, competing offers to purchase the same property. Consider the following dynamics:
Sellers want to get the highest price and best terms for their property
Buyers want to buy at the lowest price and on the most favorable terms
Listing brokers - acting on behalf of sellers - represent sellers’ interests
Buyer representatives represent the interests of buyer clients.
Will a seller disclosing information about one buyer’s offer make a second buyer more likely to make a full price offer? Or will that second buyer decide to pursue a different property?
Will a seller telling several buyers that each is being given the chance to make their ‘best offer’ result in spirited competition for the property? Or will it result in the buyers looking elsewhere?
Knowledgeable buyers and sellers realize there are rarely simple answers to complex situations. But some fundamental principles can make negotiating multiple offers in the hot Austin real estate market a little simpler.
Sellers have several ways to deal with multiple offers.
A seller can accept the “best” offer
A seller can inform all potential purchasers that other offers are on the table and give them all the chance to strengthen their offers;
A seller can counter one offer while waiting to respond to the other offers
A seller can counter one offer and reject the others
While the listing broker can offer suggestions and advice, decisions about how the offers will be presented - and dealt with - are made by the seller, not by the listing broker.
Purchase offers are not generally confidential. In some cases, sellers may make other buyers aware that your offer is in hand, or even disclose details about your offer to another buyer in hopes of encouraging that buyer to make a “better” offer.
Buyers and sellers need to appreciate that in multiple offer situations only one offer will result in a sale, and the other buyers will often be disappointed that their offers were not accepted. While little can be done to prevent that disappointment, fair and honest treatment throughout the negotiation process, couple with prompt, ongoing and open communication, can enhance the chance that all buyers - successful or not - will feel they were treated fairly and honestly.
- by Rodney Campbell