Accepting or Declining an Offer
You have worked out the price that you want for your property, agreed on the marketing strategy and done everything that you can to present the property in the best possible way. Now the waiting game to find a Buyer begins and it is always thrilling when you receive the news of your first offer.
If the first offer is high and matches, or is close to your aspirational price, it can make you question whether you have set your sights too low. However – there could be several reasons why the Buyer has come in high with their first offer. They could have been in the market for a while and tired of playing the negotiation game. They want to secure the property quickly and are prepared to pay a premium price for peace of mind. Knocking back an offer because it is your first, or because you think you can get more, could end up being a mistake. Try not to focus on whether it is your first offer. Evaluate the offer based on what you were asking and on what is realistic for the market conditions. There is a saying in Real Estate that your first offer can sometimes be your best offer and there are many stories of Sellers knocking back an early offer and then ultimately having to settle for a lower price down the track.
Online marketing has influenced how people make offers and view property. Looking for property is now faster and easier. People get pre-approval for loans, they can do their research on a property much faster and this means that they may be more likely to make an offer faster. When evaluating a first or early offer examine the context as part of your decision-making. What are the market conditions, how many people have viewed the property, what has their feedback been? It is also worth factoring in the conditions that come attached to the financial offer. A lower price with more favourable conditions, e.g. no conditions or a more suitable settlement period may be more advantageous than a higher offer with a range of conditions. Your own circumstances will also play a major role in determining what you accept. If you have already purchased elsewhere and have a deadline to meet for settlement, this will factor heavily into your decision making.
Another mistake is to presume that once an offer has been made, that the Buyer will be prepared to have a long and protracted period of negotiation. If you appear to be bargaining too hard or taking too long to make up your mind about a decision, there is nothing stopping the Buyer from withdrawing the offer and setting their sights on another property.
If the offer is not up to expectation and falls short of what you are prepared to accept, your Agent will help you determine the counter-offer. Their expertise will include being able to gauge the Buyer’s motivation and have a better understanding of their budget. These factors will play a major part in how you structure your negotiation tactics.
The best thing you can do is to know your options and determine a fair price. What is your bottom line and what is a realistic target? The negotiation phase can be especially nerve-wracking and you will need to be confident and diligent in how you approach this. Determining whether to accept an offer or not can be one of the most challenging decisions that you have to make as a Seller. At the end of the day - Trust in your Agent’s advice. You selected them for their expertise and they are duty bound to get you the best possible price. Let them do the work for you!