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As
a listing agent dealing with multiple offers, you will focus on maximizing the
advantage for your client, at the same time being fair and even-handed with each
selling agent, all within the context of local laws and customs.
A specific time should be set to consider all offers, and all parties
should be advised. Critical
questions are whether selling agents will present offers in person and whether
each will be allowed to hear the other offers.
To the extent that information is power, it is probably better to have
agents present their respective offers separately.
If the selling agents are not going to present their offers in person,
you might have the offers submitted to you in sealed envelopes to be opened in
the presence of the seller at the appointed time. Of course you will avoid making counteroffers to more than
one buyer at a time; your role is to sell the home only once.
If a counteroffer is necessary, set a reasonable deadline for the
selected buyer’s response, verbally or in writing according to local custom. If
your buyer is buying a new home, you are dealing with a professional home seller
in a unique market environment. The
new home builder knows where the market is and where his products fit into the
price spectrum. Otherwise, he would
be out of business whether his prices were either too high or too low. New home prices usually will be less negotiable than resale
prices. Sometimes they will not be
negotiable at all. But sometimes a
builder will include extras at little or no additional cost.
A builder can add a $4,000 deck during construction of your home for much
less than $4,000. Most builders will help with closing costs by giving a
credit. Sometimes the builder’s
agent will volunteer information on standard or even possible additional
concessions. Contracts should be
read carefully by both you and your buyer, but be sure your buyer understands
that you are not a substitute for a lawyer. When
your buyer is ready to make an offer on a new home, call the builder’s agent
and ask if the builder is considering offers.
The agent wants to see you again. His
job is to bring contracts. Profitability
is someone else’s job. If the
agent has any chance of making an offer work, you will be encouraged. If he tells you that the list and option prices are firm and
there is no negotiation, he is risking your buyer’s business.
But you can expect an accurate answer in any case.
Everyone will agree there is no future in spending an hour or two on an
offer that surely will be countered at the list price.
Especially important with new homes: Ask that your buyer’s deposit be
held by a real estate firm or by the closing agent.
Real estate broker and closing agent escrow accounts are generally
subject to strict governmental controls. In
the event your builder has unforeseen irreparable financial difficulties between
the time of contract and the closing, your buyer’s funds will be safe.
Buying a home that is not yet built requires a degree of faith and trust
over and above that required for an existing home.
It is especially important to begin the process with a comfortable
feeling. In
any event, new home or resale, you often will not know what is in your
client’s mind. Sometime you
cannot know because your client hasn’t a clue either.
Not all buyers and sellers express remorse following conclusion of a
negotiation, but such feelings are widespread.
As an experienced agent, you can help.
When negotiations are nearing agreement, hopefully at the last stage,
play this imagination game with your client.
Ask him to consider carefully the terms and conditions to which he is
about to agree. Remind your client
that a contract is binding and that details can be changed only with the
agreement of all parties. Then ask
him to imagine that the proposal on the table was finalized and that he has had
a good night’s rest and it is now tomorrow morning.
Will he have reservations about the agreement? Could he have done better?
Remind him that tomorrow morning will be too late to make changes.
Is he sure he wants this proposal to become a binding contract now?
Of course you will be alert to that introspective client who decides to
sleep on it. Just advise that there
will be no additional information available in the morning, and that a delay can
serve only as an opportunity for the other party to reconsider too: So if the
terms are acceptable, sign now. Published
in FPG’s March 2002 |
