You've been home shopping for a while now and that perfect home just came on the market. You view the home with your realtor the first day it is available for showing. You decide it is "the" home and you instruct your realtor that you would like to make an offer. After having your realtor prepare the offer you are nervous, excited and hopeful your offer will be accepted or at worst get a reasonable counter-offer back.
After anxious anticipation, your phone rings and YES! - its your realtor! Your realtor is calling to inform you the listing agent has informed him/her that there is a second offer coming on the home. What happens now?
In this situation everyone has to be treated equitably. Your offer will be returned to you and you will be given the opportunity to resubmit your "best offer". You have now shifted from a negotiation situation to a competing situation. You will want the seller(s) to choose your offer over the other offer(s) yet you still want to get a fair deal on the home. Remember the other party(ies) are in the same situation - everyone wants to have the successful offer but no one wants to pay too much. To maintain fairness everyone making an offer is made aware there will be competing offers and the offers will be submitted to the listing agent in a sealed envelope to be opened in front of the seller(s) (all to be presented at the same time). The seller will be considering each offer on its own merit. The best price does not always win - it often comes down to the strength of the offer and such things as deposit, downpayment, and the conditions the buyer is asking for. I would advise my clients to make their best offer with the best price and conditions they can be happy with. If they are successful they will be happy that they got a fair deal and if it sold for a higher price or with fewer conditions they can to be content that they gave it their best shot and were not prepared to do any more for this particular property.
From a realtor's perspective this is a difficult situation because it never feels like a win-win situation with buyer clients. Fortunately, this situation does not arise as often in our local market as it does in other areas but it is always a possibility and as a buyer you should be aware this situation may occur.
If you have any questions about multiple offer situations please feel free to give me a call at 761-5253 or drop me an email.