The Multiple Counter Offers
Tim Ford | Sunday Nov. 1st, 2020
Last month, I wrote about how buyers can try to be competitive in multiple offer scenarios. As we continue to see new listings generating multiple offers, we’re also seeing an increase in the use of the multiple counter offer form. This form or process can be new to many buyers and sellers and is worth discussing.
If a seller receives multiple offers for their property, they have a few options. They can pick their favorite offer from the group of offers, sign it and be done. They can also pick their favorite offer from the group and make a counter offer to just one particular buyer. Or, they can make a multiple counter to more than one buyer.
The multiple counter offer form used by REALTORS® in the Bozeman area is a specific form and differs from the standard counter offer form in that in order for it to be a binding agreement between buyer and seller, the seller needs to sign it twice.
Let’s go through a quick example. A seller receives 6 offers on their property. Of the 6 offers, there are 3 that stand out to the seller and they decide to do a multiple counter to just those 3. They send out the multiple counter to the 3 buyers. Two of those 3 decide to accept the seller’s counter offer and sign the multiple counter form and send back to the seller. In order for the multiple counter to be a binding contract, the seller at this point will decide which of the 2 multiple counters they want to accept. They will then sign it a second time, deliver to the buyers, and they will have an accepted contract.
The multiple counters sent out to different buyers by the seller do not need to have the same terms. Perhaps some dates, terms, or contingencies make one offer more or less attractive than another and therefore the seller may be willing to accept more or less from one buyer versus another.
Buyers that receive a multiple counter have a few options. If they really want the house or property, they can actually make a counter to the multiple counter and increase the attractiveness of their offer in order to try to be the successful buyer. They could also counter less than the amount of the multiple counter, or decide to sit it out, or reiterate their original offer was their highest and best. The last 3 options have a lower likelihood of securing the contract for the property.
It seems that personalities often dictate which response a seller will choose in a multiple offer scenario. Some enjoy the multiple counter process while others prefer a simpler approach. When getting involved in a multiple offer scenario, buyers should be aware the seller is under no obligation to include all buyers in a multiple counter. Therefore, buyers should really put their best offer forward as they may not have an opportunity to increase or improve it.
As usual, I have included the latest Real Estate statistics. The Real Estate market has stayed busy into the fall as prices have continued upwards. In addition to these closed transactions, another 191 home sales are currently pending or under contract as of the date of writing, which compares to 144 home sales pending this time last year.
The included data reflects sales of homes in the greater Bozeman area, including Four Corners, Gallatin Gateway, Bridger Canyon, and Bozeman city limits. The data includes home sales reported through the local Big Sky Country MLS, and does not include private party sales, Condominiums, or Townhouses.