by Anita Raushel, Realtor, Iron Country Realty
Chisholm Minnesota real estate agent Anita Raushel helps her clients choose the best real estate offer when selling their home or property.
When you get more than one offer for your home, how do you choose the best one? This can be a tough decision for many home owners. That’s why I educate my clients about the offer and negotiation process beforehand so they can make the best decision when they do receive an offer to buy their home.
All offers are eligible for negotiation. It is standard practice for seller and buyer to go back and forth once an offer is submitted to arrive at mutually agreeable terms that each party is happy with.
Look at the legal documents – Make sure you understand the actual contract you will be signing. Familiarize yourself with the legal aspects of the contract, including important things like the amount of escrow being held, the amount of money the buyer will be mortgaging, the closing date and any other inserted contingencies.
Decide on your priorities – It is always helpful to be clear in your own mind as to your personal goals from your home or property sale. Think about the things that are most important to you: what terms are negotiable, and which terms are not. If you have a definite price in mind, you may need to wait and stand firm through a number of offers. If you want to sell as soon as possible, you may have to accept the first offer you receive. Take some time to get clear on what it is you want out of the deal, understand what you may have to give to get it, and negotiate accordingly.
Have a plan – Your agent probably has an established process for accepting offers on a house. Discuss your agent’s procedures when you first start working together so that you know what to expect. Real estate agents are usually flexible, within reason, and will want you to be as happy as you can be while the work is being done. He or she will advise you on a time frame for when to take offers and will discuss with you how you will analyze those offers. Your Realtor should know ahead of time what your personal priorities are concerning the sale of the home and he or she should explain what it will take to achieve those goals. For example if you need an extended closing the real estate agent should be told in advance before an offer ever gets placed on your property.
Scrutinize every offer. Your house is showing, you are getting interest, and then it happens – you get your first offer. You will be tempted to grab onto it, to accept it, just to be finished with all of the work and the waiting. Slow down. Realize that if things go well, you will be getting plenty more of these offers if your home is priced competitively for the current market. The last thing you want is to feel remorseful after the sale because you accepted a lower price and less favorable terms than you really wanted. Remember your priorities and your plan.
Offers can include requests for repairs or changes to your home as a condition for sale. The buyer may ask for you to include things like your washer, dryer, refrigerator or other high ticket items in the sale of you home. The offer may include a substantial amount of earnest money – meaning it is harder for the buyer to change their mind and rescind the offer – or no earnest money at all. The offer may ask that you cover closing costs, or that you follow a time line that is drastically different than what you were hoping for.
Remember, all of these are negotiable. You don’t have to accept any of them if you don’t want to. You could receive a low ball real estate offer. Don’t get offended if this happens; successful negotiations keep personal feelings out of the dealings.
Look at each part of the deal and decide if you are willing to accept it and understand what you are getting out of the deal. Every deal requires give and take – just make sure you are getting enough for what you are giving up. Never let emotions get in the way of making sound business decisions.
When Your Home Has Been on the Market for an Extended Period of Time
If your home has been on the market for an extended period of time, it is possible that what you think is a low ball offer might in fact be the actual market value or close to it.
One of the top five home seller mistakes is pricing a home too high. As a seller you receive absolutely no benefit when you overprice your property. The common thinking among many homeowners is that “if I price my home higher it will sell for more money.” While this thinking may appear logical, it does not hold true. Homes that are overpriced languish on the market and end up being reduced over and over again until they hit the right number. By this time buyers are asking themselves, “what’s wrong with this home?” They look at the days on the market and end up offering you less than what the home should have sold for if priced correctly from day one.
Getting a good offer on your home is an exciting proposition. You can see the light at the end of the tunnel for reaching your goals. Just go in being prepared for what awaits you. Stress in real estate transactions often comes from not being prepared. With this advice in hand you should be well armed when an offer comes in on your property.