You’ve worked hard to get your home ready for sale. You’ve staged it properly, kept it spick-and-span, kept beds made and clothes out of site. Buyers came through on private tours and via open house events. And now, you have an offer, or several! No matter the number of offers in hand, you’ll need to review each one carefully. Every offer has its strengths and drawbacks. There rarely is a perfect offer, but there is usually at least one that is a great option with which to work. Here are five tips that can assist you as you evaluate.
1. Know the process.
When you receive an offer you can accept it, reject it outright, or you can work to negotiate some of the terms so the offer is more favorable to your needs. Keep in mind that all offers are negotiable. If you get an offer that meets your needs, you don’t have to negotiate. But, when you receive an offer that is less that satisfactory, keep in mind that may not be the final answer from the buyer. Negotiate! Returning a response offer asking for modified terms is called a counteroffer. Once the potential purchaser receives your counter, they then have the same right: accept, reject, or negotiate back. This can go on for a couple of rounds. I recently finished a negotiation period that lasted 4 days. In the end, we came to terms that were agreeable to both parties. Negotiations can take time and you need to be prepared not to get the last word. The goal is to reach terms acceptable to both parties.
2. Don’t take it personally.
When you get into the negotiations, it can be tempting to reject a counter outright. I recently had a client say, “They didn’t counter with what I expected, so I don’t want to negotiate further.” That’s a missed opportunity! Just because your first counter didn’t get the response you wanted, it doesn’t mean you can’t find agreeable terms. Being “right,” or getting the last word, in a negotiation process should not be your goal. Selling your home can be emotional. But truly it is a business transaction. If you can set your emotions aside and treat it as a business deal, you will have a much better process and outcome.
3. Think about your bottom line.
In advance of reviewing any offer, have a heart-to-heart with yourself and your agent to decide what terms are most important to you. If closing by a certain date is important, you may need to be flexible on price, or vice versa. Decide what you can, and will, be flexible on so that when the times come to negotiate you are prepared.
4. Review every term.
Some sellers immediately zero in on the price. They ignore all of the other terms of the offer. They see the price and let that guide their decision. You have to evaluate all of the terms of every offer—not just price. Yes, the offered purchase price is important, but so are the other terms. Is the amount of earnest money the buyer proposes adequate? Is there a lender pre-approval or pre-qualification letter included? Are they asking for a home inspection and multiple repairs? Do they want a home warranty, too? With each term of the offer you need to ask yourself: Is this a deal breaker, or can I be flexible on this point to reach the ultimate goal of selling my house?
5. Think outside the box.
Receiving an offer with unacceptable terms can open the door to creativity. Talk with your agent and see if they can discover what is important to the buyer. With that information in hand, is there is a way to structure the deal to meet both of your needs? Perhaps the buyer needs to move quickly, for example, but you have nowhere to go. Maybe a bit of a higher price would give you the cash you need to rent temporary housing until you close on your new place.
The most important things to remember while reviewing offers is to remove your emotions, think in terms of a business deal, and remain flexible.