Multiple offers--how quickly must I respond?

minneapolisiteJune 21, 2012

Our house went on the market yesterday and we listed it at what I believe is its fair market value. Within 24 hours we had 13 showings scheduled and 2 offers.

One of the offers we will reject outright (it's a low ball offer.) The other offer is $1,000 less than list, with $5,000 in seller paid closing costs. Because there has been so much interest so fast, we're suspecting tomorrow and Saturday may yield more offers, but I can't guess if they will be better or worse. How quickly must we respond to this offer? Is it okay to wait a day or two to see what other offers come in?

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kirkhall

What does the offer say? Some of them have a clause that you must reply within...24 hours. 3 days. etc.

Exciting! (Do you have an agent? What does she/he say?)

    Bookmark   June 21, 2012 at 9:02PM
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minneapolisite

Realtor just called to say that the first person upped their offer AND we have a third offer coming in. Exciting!

    Bookmark   June 21, 2012 at 9:49PM
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jane__ny

Offers should be in writing only! I would not respond to verbal offers.

Jane

    Bookmark   June 21, 2012 at 9:51PM
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linda117117

You can say you want to wait thru the weekend. Then have your agent go back to all the other agents who submitted offers and ask for highest and best! This gives all the buyers one last opportunity to submit their best offer (price and terms. the highest offer is not always the best offer) You can choose the best offer from all offers submitted.

    Bookmark   June 21, 2012 at 10:10PM
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minneapolisite

@jane the offers are all in writing and come with earnest money checks.

@linda I like that idea. We would be taking a risk that they might move on between now and then. I guess we'll have to decide if we want a safe bet or if we want to take a gamble!

    Bookmark   June 21, 2012 at 10:47PM
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sheilajoyce_gw

Congratulations!

    Bookmark   June 21, 2012 at 11:14PM
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ncrealestateguy

Linda is correct... wait through the weekend, and then tell all buyers to submit their "Highest and Best" w/in the next 24 hours or so. Do not reject even the lowball offers. Send them a request for Highest and Best also.

    Bookmark   June 21, 2012 at 11:15PM
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chispa

Makes you wonder if you priced the house a wee bit too low? Just be carefull with multiple offer ... this isn't 2004 anymore! Back then when we bought we would cancel our offer if we were told there were multiple offers. We weren't willing to play the game. Many agents were lying about more offers and getting buyers to bid against themselves.

My area is also having some listings with multiple offers due to lack of good inventory ... crazy time to overpay when the RE market is still unstable.

    Bookmark   June 22, 2012 at 12:02AM
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minneapolisite

I don't think the house is priced too low. I think it's priced just right. There is exactly ONE recent comparable in our area, and it sold for $144,000. We listed at $144,900 and the offers are effectively all about $139,000. My husband expressed a concern that even if we got a much higher offer, the house wouldn't appraise that high, so their FHA financing would fall through. (All offers so far are contingent on FHA financing.) I have another question I'm going to post in a new thread. :)

    Bookmark   June 22, 2012 at 8:22AM
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barbcollins

Congratulations!

Can you post a link to your MLS listing? I want to see what you are doing right :)

    Bookmark   June 22, 2012 at 8:28AM
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littleprincess

"Back then when we bought we would cancel our offer if we were told there were multiple offers."

This is what I thought immediately when someone said something about highest and best offer. In our current buying situation, if they had come back asking for highest and best, we'd have withdrawn our offer and gone elsewhere. There were other good choices we'd seen and we didn't want to be involved in a bidding war at all.

However, from a seller's point of view, this is a good situation to be in (what the house will appraise for IS a concern. The house we are buying managed to appraise for what the final number was -- but just. No extra.)

    Bookmark   June 22, 2012 at 10:20AM
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minneapolisite

Our first-choice offer does not have an expiration date, but the agent suggests we respond "by 12:30 today." He is acting as both the buyer and seller's agent so he has to keep us both at arm's length. And of course he has a strong interest in our selling to his buyer because his commission is larger.

We currently have 7 more showings on the schedule for today/tomorrow.

What do you guys think? Try to delay accepting this offer by 24 hours, or just accept it and be done with it?

    Bookmark   June 22, 2012 at 10:48AM
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littleprincess

Ugh. So you don't have your own agent on that offer? I wouldn't like that situation.

    Bookmark   June 22, 2012 at 11:36AM
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sylviatexas1

*Why* respond to one offer by lunchtime today?

Also, be sure your listing agent brings mortgage commitment letters or proof of funds letters for every one of these buyers.

    Bookmark   June 22, 2012 at 1:05PM
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lyfia

Sounds like the representing both buyer and sellers is already in question on doing his best in representing both. Your best interest would be waiting until after tomorrow to respond. The buyers best interest would be for a quick response.

Not sure I'd like that situation too much with a push like that especially since the agent knows there are more showings.

    Bookmark   June 22, 2012 at 3:47PM
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ncrealestateguy

Yeah, why only respond to the one offer and not all three? Please tell us the agent's rationale with this?
Also, Why is it that sellers opt to walk away when knowing that there are multiple offers? Just submit your highest and best and be done with it. Your highest and best does not have to be any different than it would have been if there were no other offers. At least this way, you still have a fighting chance on getting the property.

    Bookmark   June 23, 2012 at 9:15AM
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sylviatexas1

ncreguy means why do buyers walk away, right?

This has been percolating in my brain, & it finally occurs to me to ask,
why?

Why so many showings, why so many offers, why such a flurry?

Usually, when I see Realtors & buyers swarming like this, it's because the price is a steal.

    Bookmark   June 23, 2012 at 10:34AM
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brickeyee

"Yeah, why only respond to the one offer and not all three?"

You cannot accept all three, so you can only really respond one at a time (unless you reject all and ask for BAFO).

I will not engage in bidding n a place. Period.

I will not play at 'BAFO.'
I already gave my best offer.

    Bookmark   June 23, 2012 at 11:21AM
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linda117117

Its probably too late to respond to this but I will anyway for future sellers. If this is the first weekend on the market, you have every right AND SHOULD wait thru the weekend for all showings. YOUR AGENT is not representing your best interest if he is putting pressure on you to answer an offer when he knows it is a hot listing and you have 7 scheduled showings. (he is showing his true colors with the fact that the offer is his own buyer) When we have a "hot house" here, with multiple offers, we actually say in the first line of the listing, "Multiple offer situation, all offers submitted by 5pm on such and such a date". People that withdraw their offer because there are multiple bids are not the type of buyer you want on your home anyway and most likely the deal wouldnt have gone thru with them. You want someone who loves the house and will fight for it. Not someone who is so nonchalant about it that it doesnt matter to them if they dont get it.

NCRealEstateGuy (Mike) is correct, a buyer who wants the house will make their best offer regardless if there are multiple offers. They have absolutely nothing to lose by doing that, they do lose the house if they withdraw.

Brickeye,the majority of buyers DO NOT submit their best offer the first time around. They submit an offer to "feel out the seller". If i remember correctly, you buy investment properties, this is a different type of buyer entirely. Real estate is emotional for most buyers, it is not for investors.

minneapolisite, please keep us updated as to how things turned out.

    Bookmark   June 24, 2012 at 8:32AM
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brickeyee

"If i remember correctly, you buy investment properties, this is a different type of buyer entirely. Real estate is emotional for most buyers, it is not for investors. "

I also have a house to live in.

    Bookmark   June 24, 2012 at 9:45AM
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minneapolisite

We countered on the best offer and the buyer accepted our counter offer, pending an FHA appraisal.

The buyer indicated that she was flexible on the closing date, so we were able to basically choose our own closing date. That will save us $3000 in living expenses. And because she used our listing agent as her buyer's agent, we will save $2000 on commissions.

I double-checked the recently sold homes in our area and I am pretty confident we sold it at fair market value. I have been second guessing myself a little bit when I get emotional over it, but I keep going back to the comps (similar houses selling for $128,000 - $144,000) and feel like we did okay selling at $144,000 minus $4,000 in closing costs.

    Bookmark   June 24, 2012 at 11:46AM
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sweeby

Congratulations on the quick sale!

    Bookmark   June 24, 2012 at 5:09PM
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ncrealestateguy

What was your eventual rationale for not countering ALL of the offers, and only the one?

    Bookmark   June 25, 2012 at 7:40AM
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minneapolisite

ncrealestateguy, I didn't counter all of the offers because if everyone accepted my counter, I only have 1 house to sell, and I would be in breach of 2 out of 3 contracts. I'm honestly surprised someone with "realestateguy" in his user name is asking this question. :/

    Bookmark   June 25, 2012 at 9:37AM
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brickeyee

"What was your eventual rationale for not countering ALL of the offers..."

How do you propose to do this?

A counter becomes a valid contract when it is signed.

You are going to sell the sample house multiple times?

Each of those counters has the possibility to generate a valid contract.

The first one accepted and signed is likely to be held valid when the court squabbling settles down.

    Bookmark   June 25, 2012 at 9:40AM
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greg_2010

I'm sure NC meant requesting their best and final offer (like he suggested earlier), not countering with an actual number.

    Bookmark   June 25, 2012 at 9:48AM
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ncrealestateguy

Thanks Greg, that is what I meant.
Seems to me the poster does not want to answer the question as to why his Realtor recommended only working with the one offer and not all three! Most buyers dream of having a multiple offer situation.
Can you let us know why you and the agent thought this was the best alternative for your sale?

    Bookmark   June 26, 2012 at 7:54AM
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