Once a seller lists their house, the hope is that they will quickly receive an offer. Sometimes, multiple offers come in at once and sellers aren’t sure what to do. It can be a good problem to have, but it can also be overwhelming. They may not know what to say, how to evaluate the offers, or how to respond. As their agent, you should lay out all the details of each offer and help them make an informed and confident decision.
It’s Not All About Price
Many motivated sellers are eager to jump on the first offer that comes in at asking price, or closest to it. But as their agent, it is important to remind them that price shouldn’t be the only factor to consider when accepting an offer. Oftentimes, an offer that comes in at asking price also comes with contingencies. The buyer may be willing to pay the asking price, but only if the seller can meet their list of demands. This may mean being flexible with the closing date or taking care of repairs or renovations. Help your sellers look past the price and carefully examine how each offer will either contribute or take away from the ease of the sale.
When multiple offers come in, sellers need to determine buyer motivation. Is there one offer that is a little under asking price but is ready to close right away? A highly motivated buyer is usually focused on three main issues: risk reduction, time, and cost. Knowing this, you can help sort through multiple offers to determine who is motivated by what, and how you can modify your negotiation strategy to meet their needs.
A highly motivated buyer will be willing to pay more and expect less, which works in the best interest of the seller. Help your seller understand the power in a motivated buyer and use it to choose between multiple offers.
Talk About Timeline
Motivation and time often go hand in hand. If your seller is eager to get out and move on, the offer who can make this happen may be more attractive than the offer that meets the asking price but needs to draw out the closing process for weeks or months. If your seller needs time, they may want to consider an offer that provides more flexibility in the closing process. Along with the price and how motivated the buyer is, the timeline can be an important factor when sellers are trying to decide between multiple offers.
Factor In Financing
What happens when multiple offers come in at asking price and meet the seller’s criteria for the closing timeline and motivation factors? When this happens, it is important to dive deeper into the financing aspect of the sale and determine if all potential buyers are actually capable of securing the financing to close the deal. Some buyers may have to sell their property or assets before they can purchase the property. Others may be waiting to qualify for a loan, or have other obstacles in the way preventing them from moving forward with the sale. This can be a significant factor when deciding which offer to choose.
Receiving multiple offers on a home is usually a great problem to have. But choosing the right one can be overwhelming for sellers, and as an agent, it is your job to walk them through all of their options and point them toward the offer that best meets their needs.
Understanding the complexities of negotiations and handling offers is a skill that comes with time. If you want to learn more about how to help your clients through these kinds of situations, or are looking to close more deals or build your brand, check out some of Mbition’s online courses geared toward new agents. Click here to see some of the available online classes you can take to help accelerate your real estate career.