So… you are selling your home and just received the first offer after listing your property. Your agent told you that the offered price is a bit low than asking. Your heart drops, and you want your agent to reject it. But as any Real Estate Expert, they advise you to accept the offer.
Now the most common question comes, ‘Should I accept an offer on my house for the first time?’
Let me clear it first that although there isn’t any hard and fast rule for accepting the offer initially or later; it is always wise to take to the first offer. But why? Let’s get deeper to know the effects of accepting or rejecting the offer received for the first time.
The question is asked a lot of times “Is the first offer always the best offer?” and you will always be advised to take the first time. But is it true, or is it just a cliche? We have answered your questions in this article; keep going!
Let’s get to the situations you might face when receiving the first offer on your house.
Scenario1: If this is the first quick offer to buy, take the time to study it!
You have put your home up for sale, and you have just received a first purchase offer at a lower price than the one you posted. In this case, several scenarios are available to you, and you must take the time to study this offer according to various parameters:
- If your home has been on the market for a short time (less than 1 or 2 months), you can afford to take the time to think about it because you are obviously not immune to someone else making you a more interesting proposal soon.
- If it has been more than 3 months since you listed your property and this is only the first offer, it may be wise to accept it, as buyers have seemed to rush soon. In this case, you do not have the assurance that another person will make a more interesting proposition and know that the more time passes, the more your home will lose its value in the eyes of buyers.
Scenario2: If you are getting the price that you asked!
If you have just received an offer at the price you have set, you can, of course, take the time to study the profile of the buyer. Study the buyer who made the offer in order to make sure that they are solvent and that the process of sale will have every chance of being successful before accepting his offer. But anyway, it’s hard to turn down an offer at the set price. So, without thinking too much, it’s always an intelligent decision to accept that offer.
Scenario3: If you receive two offers, compare the buyer profiles!
It may happen that buyers are particularly interested in your home, and you find yourself confronted with two offers to purchase from two different buyers. In this case, it will be wiser to accept the offer of the person who seems the most solvent and whose file will be the strongest. Indeed, when one signs a preliminary contract with a purchaser, the suspensive clauses make it possible to break the contract and in particular, the case for which the purchaser does not obtain his mortgage. The real estate agent helps you to distinguish the best profile by taking into account different criteria:
- If you are faced with a buyer who is about to settle the sale price for cash, he will then have an interesting profile since he will not need the help of the bank.
- If you are faced with a couple on one side wanting to buy together, and on the other side, a single person, the former will generally be considered more creditworthy.
- You can also find out about the amount of the contribution of each of the buyers because the one who will bring the highest amount will have a better chance of obtaining his mortgage.
Now, when you have understood the different scenarios, let us come back to the question – Is the first offer always the best offer?
How to know if your first offer on the house is good or not?
Not to say that seller should set the price of a home rightly after thorough research. The knowledge of the local market is really important to set a realistic expectation. An agent would be able to provide you information on market conditions and do a proper comparison.
Confidence in setting the right price will help the seller respond positively to any offer. When it is not mandatory to accept the first offer, it clearly affects the property. As already said,
The more time a property sits on the market, the staler it becomes!
A new listing always attracts more potential buyers and have greater chances of receiving a valuable offer. A study has proven that the less time a property takes to get sold, the less discounting takes place.
This implies the initial offer would always be better as there is more activity by serious buyers at an early stage. The price would gradually decrease with the time property sits on the market.
Hope you have got enough knowledge to make a wise and practical decision. Good luck!