It’s been common knowledge for years: agents need to bring their highest and best offers when they want their clients to score the right home. And seller’s agents have an ethical obligation to present every offer received.
But what happens when the highest offer isn’t really the best offer?
Benchmark Realtor® Mary O’Neil knows that while there’s some overlap with highest and best, they’re not always the same thing.
929 Woodmont: How a Lower Offer Trumped a Higher One
When O’Neil listed this property—a two-bedroom, one-bathroom gem on a 0.32-acre lot in Davidson County—she had to price it carefully. As Realtors, we’re all too familiar with what happens to an overpriced home on the Nashville real estate market, but O’Neil handled it adeptly and ended up receiving multiple offers.
“While this home was a smaller one, it had been obviously loved and maintained. The seller had taken a job out of state and realized that she should make the best decision for herself. She did say repeatedly that she hoped someone would love this home as she had. It was truly a personal space and she has a great love for this city, its art and character,” says O’Neil.
“The house had multiple offers to be presented at a specific time. I had printed everything out, highlighted the benefits of each and put them in the order I thought preferable,” says O’Neil.
Another offer came in—one that was higher than all the rest—as O’Neil was on her way out the door. “I quickly printed without even reading it, and included it in my stack of offers,” she remembers. (In addition to the Realtor Code of Ethics, Tennessee law requires sellers’ agents to present every offer to their clients to be countered, accepted or rejected—so that’s what O’Neil did.)
When O’Neil arrived to deliver the offers and chat with her client, she noticed that the last offer was $100,000 over the asking price.
Her jaw dropped, and from the seller’s home, she called the agent to make sure there wasn’t a typo.
It wasn’t a typo, and it was a cash offer.
It came from a developer who wanted to demolish the home.
“In Nashville, as you know, the growth is tremendous. While the city is enjoying this aspect, many feel we are losing much of our charm and character, so a Realtor can often feel they are in a Catch 22 situation,” says O’Neil.
Benchmark Realty Agent
“This house is on a busy thoroughfare of fine older homes. It is a street most everyone uses and the homes with their manicured lawns and big trees defines this city. Houses are being torn down and two put back on lots, so that every week the street seems to change.”
When O’Neil spoke with the agent, “She said her investor is serious and does not play by any rules but his own. Then she began to ask me questions about elevation of the property. I explained that I do not offer that information as I am a Realtor, not a surveyor. And then I asked if they had not visually taken in those conditions. She then said they had not driven by or seen the property.”
O’Neil’s client had wanted to sell to someone who would love the home as much as she had—but she was looking at an offer that was $100,000 over asking price.
When the investor’s agent called back—just a few moments later—she had new terms. The developer wanted to change it from a cash offer to a financed offer, which could’ve spelled appraisal problems, and the agent wanted to come visit the house the next day.
The seller didn’t take that last-minute offer, though.
First, the high-dollar offer came from someone who wanted to demolish the home. The seller had been hoping for someone to live in her exceptionally well-preserved home. (When you’re working with buyers, you can’t afford to ignore sellers’ emotional attachment to their homes!)
Second, the offer came in at the last minute, and the developer hadn’t even seen the property.
The offer that the seller accepted was $25,500 over asking price. That’s a substantial amount of money, as long as you’re not comparing it to what the developer had offered, and it was altogether a great offer.
“The closing date was within 30 days. She wanted an inspection, but would not ask for repairs. The earnest money was significant,” says O’Neil, “and the buyer was a single woman wanting to live in the house. My seller knows that the new owner can tear down one day, but she still felt like someone was serious about the purchase and would cherish the home.”
The winning offer came with a letter, too; one that was highly personalized.
“She loved my seller’s taste and all her art, and felt the house spoke to her. She mentioned how difficult it is to secure a wonderful home in this market. It was a lovely and personal letter,” O’Neil recalls.
THE WINNING OFFER: THE RUN-DOWN
The offer the seller accepted had all the right components:
- It was an “as-is” offer with the option to inspect the home.
- The offer was $25,500 more than the home’s list price.
- The offer went over the $400,000 mark. (If the home had more than one bathroom, the list price could’ve been nearer to $450,000.)
- The offer came with a letter from the buyers explaining how much they loved the home and wanted to enjoy it the way the owners had.
The highest offer isn’t always the best offer, and small touches—like that letter—can make all the difference in the world when your clients find their dream home. The moral of the story? Try to put yourself in everyone’s position. Remember that selling a home is a big decision, as is buying one, and that a little professional and personal courtesy go a long way in any real estate transaction.
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