Sellers

Seller has contracted a real estate Broker/Agent and put their property for sale as an Exclusive or MLS Listing. At this time the listing agent has devised a selling plan and strategy based on the sellers wishes.

If the strategy of holding back offers is decided upon it usually means that the Listing Price of the property will be below market expectations in order to drive lots of traffic to the property and generate what is known as a bidding war.

At the time of listing the property an OFFER DATE is established setting the stage for sale date.

This is when the property is open to public viewing and if priced aggressively will generate heavy traffic.

On the offer presentation date, interested buyers prepare an Offer to Purchase with their agents and register their offer with the sellers brokerage.

This is when the results of the selling strategy become visible. In a sellers market when supply of properties is low and buyer demand is high, combined with the interest generated in your property from an aggressive listing price, you can expect several competing offers to be presented.

There is however a growing trend, where some buyers may choose not to submit an offer due to the current ‘secret offer’ methods which is customary and mandated by licensed Broker/Agents.

Here is where things go very well or take a turn in the wrong direction. This is were the skills of your agent become of paramount value.

We will not get into all the details associated with this stage as there are many factors that contribute to the outcome. We will however highlight some of the key factors:

1. At a certain time the selling agent will review all submitted offers with the seller(s), if any. There are times when the property has been underpriced that competing offers can range from 3 to 30 rather easily.
2. Each offer will have different clauses and conditions and need to be reviewed individually. This is a time consuming and mentally challenging process, and can lead to oversight and errors.
3. Once all the offers are reviewed, the seller(s) and selling agent divide the offers into ones that they will consider and ones that they will not. The offers that are being considered are returned to buyer representatives and instructed to come back with something better. It is an ambiguous and somewhat risky time as potential buyers will now have the option to reconsider their offer and may or may not come back with a higher price and/or a change in conditions.
NOTE: THIS IS THE TURNING POINT. Most buyers are familiar with comparable sales and an approximate value of a home. You MAY get the buyer that is willing to come back with a much greater price than others, but as buyers are cautious, you may not. If the best buyer (who was most likely willing to pay a higher price) knew how much more was needed to outbid another buyer, the seller may have most likely obtained a higher price for their home.
4. Once the back and forth handling of negotiated offers is concluded, the seller ends up choosing the one buyer offer that they are most satisfied with, concluding signatures are conducted and the deal is firmed up.

There can be several possible outcomes with traditional multiple offer presentations.

1. There will usually be one successful buyer whose offer conditions and pricing were preferred by the seller.
2. Buyer remorse can be high if the buyer ponders their purchase the next day when submitting their deposit. The question of whether or not the buyer ‘overpaid’ is a common challenge.
3. There is the risk that if the buyer overpaid for the property, the lending facility may not appraise the property at the same value. This would encumber the buyer to raise more money (which may not be available) in order to cover the mortgage shortfall. If the buyer cannot come up with the shortfall, legal proceedings may follow.
4. If the buyer and/or buyers representative feels that the conduct of the selling agent was unfair and violated certain codes of conduct, their is additional possibility of registered complaints and pending investigations.