Handling Multiple Offers

Caveats & Assumptions

• All competing offer situations are different

• Recommended guidelines

• This meeting will be from the Listing Agent’s perspective

• In the State of Pennsylvania, all agreements for the sale of real estate MUST be in writing to be enforceable. Never present an oral agreement to your Seller.

Prior to Presentation

• Never discuss terms with Seller on the phone or with an e-mail

• Never discuss terms of competing agreements with Co-op agents

• Inform all Co-op agents when the presentation will take place and how many offers are being presented

• Allow Co-op agents to adjust their offer (in writing) prior to presentation

• Co-op agents may be allowed to present their own offer (with the Seller’s permission) as long as they know the rules

Co-op Presentation Rules

• Inform co-op agent where and when the presentation is to take place

• Inform co-op agent that they will have ____ minutes to make their presentation

• You will be present during the entire presentation

• Co-op agent will be allowed to do the following:- Provide background on buyer- Present the major terms of the agreement- Answer questions

• Following co-op agent presentation, instruct co-op agent to leave the location

If One of the Agreements is Yours

• Inform all Co-op agents that one of the competing agreements is yours

• Instruct all Co-op agents to refrain from discussing the terms of their agreements with you

• Inform all Co-op agents that your Broker/Manager will be making the presentation and all communication should be through them

The Presentation

• Competing agreements should be presented in the order in which they were received

• The Seller has multiple options. Make sure they are aware what they are:

- Accept one agreement and reject all others- Counter all agreements- Counter one or some agreements and reject one or some agreements- Reject all agreements

• Anytime there is a counter, ask the Seller, “Are you OK if we never see this offer again?” Remember – counter offers void all previous offers.

Countering Agreements

• NEVER have your Seller sign an agreement until all the terms are agreed upon

• Counter using one of two methods:- Change terms in writing and initial changes- Convey terms to co-op agent in memo form

• Use this language when communicating back to co-op agent: “My seller will reconsider your agreement with the following terms: _____________”

• Inform all competing co-op agents how many agreements are still in play and when you will be re-presenting offers

Acceptance

• Most co-op agents will want to know why their agreement was not accepted. Never reveal terms of the acceptable agreement. Use the following language:

“My seller decided to accept another offer that they felt had a better price and terms.”

Guaranteed Sales Programs

Sale

What They Say - - -

“If your home doesn’t sell, we’ll buy it!”

Qualifications

Property standards:- Excellent or very good condition- No functional obsolescence- Lower and upper price ranges excluded- Certain areas or locations are excluded- Must be on public sewer (and probably public water)- No short sales or pre-foreclosure properties

Sellers Can Expect . . .

• Application Fee – Another term for an appraisal. Usually about $500.

• Market Ready Costs – Fix up costs. Could be anywhere from $0 to thousands of dollars.

• Carrying Costs – Usually about 6 months. Includes monthly payments on mortgage, utility costs and property management fees.

• Conservative Sales Price Guarantee – Usually about 5-10% below market prices.

Fine Print

• Predetermined Price Reductions – Sellers have no choice

• Sellers must sell and buy through real estate agency

• Sellers must use mortgage, title or other ancillary services

Agents Can Expect . . .

Commissions at risk if property doesn’t sell.

Average SOLD PriceCumberland & Dauphin Counties

2011 vs. 2012 (Year-to-Date)

$199,864 $200,683

$155,889

$138,757

$100,000

$120,000

$140,000

$160,000

$180,000

$200,000

$220,000

Sa

les

Pri

ce

1 2

Avg Sold Price 2011 Avg Sold Price 2012

Cumberland County Dauphin County

2011 2012

+ .4%

- 11.0%