Even with slight changes in the market, multiple offer situations are still happening in some cases. While at first this may seem like a great outcome, you will need to look at each offer to see how strong it is all around, not just in the offer price. For example do they have contingencies of selling their home or can they close when you want to? Once you review all, you then have 4 options. They are:
- Accept the best offer
- Start a bidding war and shop the best offer individually to see if they will beat it
- Conduct a “best and final”
- Counteroffer the best offer
Here are the pros and cons for each situation to help you choose which route is best for you.
1) Accept the best offer
If time is pressing and the best offer meets all of your necessary criteria, you may want to go with that one.
Pros: This saves time and unnecessary stress
Cons: You don’t always know that this was the “best” offer. There may be surprises down the road with home inspections, financing or otherwise. Also, accepting this offer may keep you from getting even more money for the home that you could get.
2) Begin a bidding war
According to ethical guidelines set proposed by the National Association of Realtors, offers don’t necessarily need to be kept confidential. So long as the agent and seller are in agreement on this, offer details can be shared.
Pros: In this case, you have the power to rule the situation.
Cons: Some buyers may be disinterested with this approach and if anyone declines to further negotiate, it may cost you an offer.
3) Go to Best and Final
With this route you let all interested parties know that there are competing offers and conduct a “best and final” offer. This informs all parties to put their best foot forward with their final offer.
Pros: This saves time as you work with everyone at the same time to squeeze out more money from them.
Cons: Similar to a bidding war, some buyers won’t want to get involved with this game and remove themselves from the situation.
4) Counter the best offer
Sometimes one offer is clearly the best one by many factors and in this case you may want to work with them while you keep the others simmering.
Pros: This can be a good option by letting the buyer know their offer was best and you are working with them to perfect it while you have back up offers in the wings.
Cons: While there isn’t much risk in this scenario, the other buyers will have only so much waiting time before they withdraw or move on to other properties.