Why the Right Real Estate Agent is Critical for Home Selling or Buying Success

When the real estate market reaches the frothy levels we have experienced over the last few years, it is safe to say most homes will sell quickly. However, does that mean you don’t need a highly qualified agent to help navigate the complexities? The high demand for real estate in this market has actually made selling or buying a house more complicated than ever. It wouldn’t be possible to cover all of complexities here, but the following is a snapshot of what sellers and buyers are up against in today’s real estate market.

Counteroffers in Real Estate Sales

In our market, it is not uncommon for a seller to receive multiple offers to purchase a home soon after listing the property. A seller cannot respond to multiple offers by sending a simple counteroffer to each offer (buyer) without creating a potential legal issue. If more than one buyer accepts the counteroffer, each would have a legally binding contract, but the seller would not be able to sell the property to more than one buyer.

One common way of dealing with a multiple buyer offer situation is when the seller chooses to respond to several buyer offers simultaneously. In this case, the seller would make a “multiple counter offer” to some or all of the potential buyers.

Responding to a Multiple Counter Offer

If the seller receives one or more responses to a multiple counter offer (either accepting it or countering it), the seller must accept and sign one buyer response in order to make the contract ratified. What if all the buyers sign the multiple counter offer? If a buyer simply accepts the multiple counter offer, that does not mean the buyer has a valid contract. The seller has to accept the buyer’s acceptance of the multiple counter offer.

Once the purchase contract has been signed by both seller and buyer, neither can arbitrarily decide to cancel it. However, until the multiple counter offer is ratified by both buyer and seller, the seller can accept an offer which is not from anyone the multiple counter offer was sent to!

Responding to Multiple Offers

The seller and his or her agent must weigh the advantages and risks of each approach. Sending a multiple counter offer cancels the offers that were originally sent by the buyers. However, the multiple counter offer clearly announces that several offers are being considered. The buyers could respond in a multitude of ways; they may be motivated to improve their offer, they may decide to resubmit their original offer, or they may decide they don’t want to get in a bidding war and not respond at all.

A seller’s agent may decide to discuss each situation with the buyer’s agent to gain a better understanding of the situation for each buyer, which, in turn, could help the seller make a more informed decision.

The value of a good agent in these situations is hard to overstate. The wrong decisions could be very costly for both seller and buyer!

Multiple Options for Multiple Counter Offers

Just as each of the buyer offers submitted probably have different terms and prices, the multiple counter offer may have different terms and prices for each of the buyer offers. The seller may like the contingencies (or lack of contingencies) in one of the offers, but not the price. Conversely, the seller may like the price but not the contingencies. Even though it is a simultaneous offer made to several potential buyers, responding with different terms makes each buyer more likely to accept the multiple counter offer.

One seller strategy is to respond with different multiple counter offer terms, trying to get the best terms while also trying to play it relatively safe. The seller could respond to one of the offers with changes, which would probably be accepted, and reply to other offers trying to get the best result.

Conversely, after the seller’s agent discusses each buyer situation with the buyer’s agent, the seller may simply decide to accept the first response to the multiple counter offers if they are confident the fastest response is the most motivated buyer.

The experience and skill of the agents involved can dramatically affect the outcome. Clearly, both the buyer and seller need to employ the most qualified agent they can find to navigate the complexities of a hot real estate market to increase their odds of success and to gain the best possible deal. QCBN

By Nick Malouff

Nick Malouff is the CEO and co-owner of Better Homes and Gardens Real Estate BloomTree Realty with offices in Prescott, Prescott Valley, Cottonwood and Sedona. To reach Nick or a highly qualified agent, please call 928-443-8800.