Selling Your Home – The Basics Of Offers

Getting offers can be emotional and stressful as you need to start making decisions. As your realtors, we will help you evaluate and negotiate offers from potential buyers in order to protect your legal interests, and to ensure you are optimizing the price and conditions surrounding the sale of your home.

Here are some basics on offers to help you prepare for when you do get an offer:

Offer Details

The offer you receive will include: the legal name of the potential buyer(s), the legal name of the seller(s), the legal civic address of the property, the price the buyer(s) is offering to pay, desired inclusions (items in or around the home that the buyers wish to have included in the sale, such as appliances, lighting fixtures or window coverings), amount of the buyer’s deposit, desired dates the potential buyer would like to take legal and physical possession of the home, legal “subjects” or “conditions” upon which the contract becomes final (such as satisfactory home inspection report or financing approval), and the date the offer expires.

Potential Responses

You can respond to an offer in one of three ways:

1. Accept as is: your signature finalizes the contract and it becomes a binding legal contract.
2. Counter offer: you may make changes to the offer, such as adjustments to the price, closing date or conditions.When you do so, the prospective buyer may accept, reject or make another counter offer in response. Only when one of the parties signs an unconditional acceptance of the other party’s offer does it become legally binding
3. Rejection of the offer: you may simply reject the offer and the sale will not go through

Offer Withdrawal

The buyer can withdraw an offer until the moment you accept in writing. If you are evaluating an attractive offer, it’s important to note that timeliness is important.

Offer Acceptance

Once both parties come to an agreement the offer is considered “accepted” and they will have a set period of time in which to satisfy the legal conditions (“subjects”) agreed to in the contract, such as completing a satisfactory home inspection report or securing financing. Only after all subjects/conditions are removed do you have a legally binding document.

Firm Offer

An offer is considered firm once all subjects have been removed by both parties. The typical subject removal period is one week to 10 days, or as agreed to in the offer.

Tips for Negotiating The Offer

With an offer in hand, the negotiation begins. The goal of this process is to help ensure you get the best possible offer on your home.

We find with our clients, this is one key area where the experience of our team can make a critical difference as emotions can run high or financial considerations can cloud decision making.  With that in mind, here are three success strategies for negotiating an offer:

1. Offer Negotiation

Price is only one of many factors to weigh as you evaluate and negotiate an offer. Every situation is different. While you may be motivated to secure the optimal price given current market conditions, you may also need to weigh other considerations such as the convenience of the buyers’ desired completion, possession and adjustment dates, their desired inclusions, the number of subjects or conditions attached to the offer, and the amount of the deposit.

2. Background Research

With some investigation, we will help assess the potential buyer’s background and goals for purchasing a property, which will assist us in negotiating a competitive price. For example, a buyer who has already sold his/her home and needs to move within a certain time frame may be willing to compromise on price if they can negotiate a date that coincides with the completion of their home sale.

3. Multiple Offers

In high-demand, low-inventory areas, you may find yourself in a situation where there are several offers for your home. Some sellers in high-demand niche markets may also intentionally list their home at a low price hoping to stimulate multiple offers.This doesn’t necessarily mean the price will be bid up significantly over the asking price, but it does mean that due diligence will be required to ensure we properly assess the strength and limitation of each offer, negotiate strategically to maximize the value you are able to get for your property, and to ensure you are protecting your legal interests in what may be a time-sensitive and complex negotiation process.

Our team can help you with every step of the process. If you’re ready to sell (or buy), we’d love to connect with you.