How To Know When To Take An Offer
Selling your home can be an emotionally grueling process, but the most difficult part can be determining whether you should accept an offer or wait for another.
Know your “ideal” offer
Before your home has even hit the market, you should be thinking about what offers you would be willing to accept. Know what your “ideal” offer is, when considering what is realistic for your home and local area, and be ready to accept that offer should it come up.
Also be knowledgeable ahead of time about how low you’re willing to go with your asking price. This is also known as your “floor” or the lowest figure you would take.
Yet an offer isn’t just about the dollar value. There are terms and conditions, as well as settlement dates, to consider when making your choice. These are especially important if you have two offers of identical monetary value, but different terms.
Ask yourself the following questions:
- What is the lowest offer you would be likely to accept?
- Is the length of settlement important to you? (How quickly can you move?)
- Would you accept an offer subject to certain inspections and/or subject to finance?
- Would you be flexible on terms and conditions if you were offered your desired price?
- Would you be flexible on the price if offered your desired terms and conditions?
- How fast do you need to sell? (Are there any financial pressures e.g. you have bought another home, it’s a divorce sale?)
Being mindful of what you may be offered upfront is a powerful way to prepare yourself ahead of time for whatever offers you may be given.
Timing and certainty
Selling a home can be nerve-wracking and it’s never a clear-cut case about what you may be offered. Every seller’s personal circumstances differ. If you are in a situation where you need to sell quickly, it’s more likely that you will take an earlier offer and you may also be inclined to take a lower price than expected.
If you have the luxury of time and little requirement to sell straight away, then you may have more flexibility to wait and may be in a stronger situation to negotiate. The element of certainty and having a clear offer in your hand, promising to end the sales campaign and the search for a buyer, can be compelling.
Every offer can be negotiated and should be considered as a base offer unless you are told otherwise. It is worthwhile always attempting to negotiate with the person making the offer as well as seeking feedback from your agent about how keen they seem on the home.
However, your ability to go back-and-forth and the amount of risk you are willing to take in losing the interest of the buyer, are usually down to your own circumstances. You do not want to be in a situation where you reject reasonable offers and are left with no serious buyers and a stale listing. Be aware of the consequences of rejecting motivated buyers in the earlier days of listing.
While most real estate markets do not move too quickly, you should be aware of what is happening locally. If a significant number of homes are set to come onto the market, this may be the impetus you need to accept an offer earlier rather than later.
If, however, the market is hot, you should be confident in knowing when a buyer is trying to low-ball you to get a bargain. Some offers are not going to be acceptable. Knowing how strong the market is and the future prospects will allow you to be comfortable rejecting or accepting an offer without regrets.
Should you take the first offer?
A first offer doesn’t necessarily mean it’s the worst offer you will achieve. In fact, the opposite is often true; the first offer can sometimes be the best. If it’s a good offer, there’s no reason not to consider it. Sometimes, the first offer is simply that – the first offer.
There is often the temptation to wait longer, fearing that you have put too low a price on your home, but some buyers are just keen to get into the market. Trust your agent and your own knowledge to make a decision. Your agent can advise you on whether there are other interested parties and the likelihood of you achieving your ideal offer in your desired time frame.