How do you respond with a full price offer?
How cool is this? The homes in The Woodlands market are selling so fast that The Woodlands Real Estate is rocking and we are seeing more and more of the multiple offer scenarios with our residential real estate listings today. What would you do if you felt like you had studied the market, priced your house competitively, put the home on MLS and now you have several offers from other agents to purchase your home?
So, just so you know, the RockStar Group does such a great job with staging and pre-marketing your home, that we now have an offer, or more in our inbox. It is time to get started on the review of the contracts, preparing our responses and getting started on the negotiations with the buyers offers.
Typically, you have three options for responding to an offer for your home, you can:
- Accept the offer: If you are OK with every detail of the buyers’ offer, you can accept it as written, sign the contract and get on the road to closing.
- Reject the offer: If you are unhappy with everything about the buyers’ offer, including the price and the variables of the contract, you can just say no thank you and ask the buyer to submit another offer. Who know, if they are still interested in purchasing the home, they will submit another offer, or
- Make a counteroffer: You can start the negotiations with the buyers by responding to their offer with a counter-offer of your own that reflects the changes to the offer that you would accept.
Evaluate Each Offer
It is so important that you and your agent have evaluated the local market conditions in The Woodlands Texas and compared similar homes to yours. Make sure you include the active homes for sale in The Woodlands, the homes that are under contract and the sold homes in The Woodlands. The sold homes should show you the percentage of list price to sale price that the homes have recently sold for. Setting your list price, you are hopeful that the buyers should respect your efforts and offer you the price you listed. However, even in a seller’s market the average list-to-sales price is closer to 97% or 98%, not 100%. Even so, this does not mean you necessarily need to reduce your sales price if you receive a less-than-full-price offer.
If you are in a seller’s market and receive multiple offers, you are more likely to have at least one of those offers at full price; however, what is the best choice? Remember, it is very important to base your next move on a variety of factors, not just price. Make sure that each offer you receive is backed with cash or solid proof of financing from a reputable lender. Check each offer for contingencies to see if they’re acceptable. Some buyers may have seller concessions for closing costs in the contract. Maybe they are asking for a home warranty, or even up front repairs. Look it over thoroughly.
Full Price Counteroffer
You can also let the buyers know you will only accept a full-price offer and see how the buyers respond. Many buyers are prepared to pay full price but think they should open negotiations with a lower offer. If in a multiple offer case, you should notify each party that several offers have been submitted and then give a timeline for adjustments and then make an offer. Some of them may make changes in price or request for concessions. Another thing to remember, is that some offers may decide to walk and not compete for the house.
If price is the most important aspect of the sale to you, consider a counteroffer at full price but perhaps offering other concessions such as your willingness to convey specific items with the house or your flexibility on the closing date.
Your counteroffer opens up the option for further negotiations with prospective buyers, but it’s important to keep market conditions in mind so you don’t lose a potential sale.
Want to know what we’re seeing in today’s market? Contact us at The RockStar Group for details!