Handling Multiple Offers
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The document outlines guidelines for handling multiple real estate offers from the listing agent’s perspective in Pennsylvania, emphasizing the importance of written agreements and proper communication protocols with co-op agents. It details the process for presenting offers, countering agreements, and the implications of guaranteed sales programs for sellers and agents. It also discusses market trends in average sold prices in Cumberland and Dauphin counties between 2011 and 2012.
Handling Multiple Offers
- 1. Handling Multiple Offers
- 2. 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.
- 3. 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
- 4. 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
- 5. 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
- 6. 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.
- 7. 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
- 8. 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.”
- 9. Guaranteed Sales Programs Sale
- 10. What They Say - - - “If your home doesn’t sell, we’ll buy it!”
- 11. 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
- 12. 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.
- 13. 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
- 14. Agents Can Expect . . . Commissions at risk if property doesn’t sell.
- 16. Average SOLD Price Cumberland & Dauphin Counties 2011 vs. 2012 (Year-to-Date) $220,000 $200,000 $199,864 $200,683 Sales Price $180,000 $160,000 $140,000 + .4% $155,889 $138,757 $120,000 - 11.0% $100,000 1 2 Cumberland County Dauphin County Avg Sold Price 2011 Avg Sold Price 2012 2011 2012