When a buyer gives you an initial offer on the house you’re selling, there may be a few things about the terms and stipulations – not to mention, the price itself – which you don’t agree with.
Faced with this situation, you may make a counteroffer – an indication that you accept a buyer’s offer to purchase the property provided that the buyer changes one or more items on the agreement.
When a buyer accepts the counteroffer, the original offer is considered void.
If your home is on the market, it is necessary that you sharpen your negotiation skills. Otherwise, you could end up losing money or a good deal because you were too nice, too considerate, or too agreeable to negotiate effectively. Counteroffers give you a chance to secure a contract that is tailored to your own terms, making them a critical component in the different steps to selling a house. It helps you decide which aspects of your home sale you are willing to compromise on while sorting out your priorities.
Quite simply, becoming good at making counteroffers is an essential skill when you sell your house. Or, you can employ the services of a good agent to advise you on how to do it effectively.
How Counteroffers Work
Generally speaking, there are three strategies you can choose from once buyers make an offer on your property:
- Accept the offer without objections
- Make a counteroffer and present changes
- Reject the offer and move to another offer
The elements that come into play when buyers make a counteroffer include:
- Price. Buyers may dispute your original asking price or they may arrive at a price that is between the original sale price and the price acceptable to the buyer.
- Convenience. Easily one of the factors that buyers look for when purchasing a property. It’s convenient for buyers to compare your home to surrounding properties in terms of features and conditions.
- Timing. Buyers will often ask for more time to decide on a counteroffer. The seller can choose to negotiate for a shorter period or reject the offer completely and entertain another offer. Although sellers and buyers are free to ask for more time to consider offers and counteroffers, there is typically a customary time limit of 1 to 3 days in which you must act upon a buyer’s counteroffer.
As much as sellers can make counteroffers, a buyer can also come up with their own. There is no limit to the number of counteroffers a buyer and seller can negotiate on, as long as both parties are willing to sit at the table and hash things out until they arrive at an agreement.
You are not required to make a counteroffer when a buyer makes an offer. Often, purchase contracts include a section near the bottom of the document to indicate that you are rejecting the buyer’s offer. Or, you can simply write “rejected” across the contract, sign it, and then indicate the date you rejected it. In some cases, buyers will specify a date when their offer expires. If you don’t respond by the said date, the offer is deemed rejected.
If the buyer is satisfied with the enclosed terms and conditions of your counteroffer, they will simply accept it and send it back to you or your designated representative. If your counteroffer has an expiration date, you can still entertain other offers even when the initial buyer is still deciding.
Typically, if another buyer offers more satisfactory terms, the seller can simply accept the second buyer’s offer and dismiss the first buyer without informing the latter of the decision.
Dealing with Multiple Counteroffers
An attractive property will naturally draw in multiple bids from buyers. The seller can:
- Accept the best offer
- Make a counteroffer on one or two buyers
- Reject the rest
And even if a buyer accepts your counteroffer, it doesn’t necessarily mean that the deal is final – you can continue to negotiate with other buyers. Ultimately, the decision on how to handle multiple offers rests solely on you, the seller, but make sure your actions and decisions comply with what is lawful and ethical.
Do you have any questions about selling your home? Interested in knowing the average Minnesota house prices or if it’s the best time to sell a house in Minnesota? We can help you sell your home, guide you when it comes to counteroffers, and provide answers to your queries about the Minnesota real estate market. Give us at Prairie Home Realty call at 320.589.2159 or email team@WeGetRealEstate.com.