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You’ve put your home on the market, and suddenly you’re fielding an influx of offers. It’s the best case scenario, but you feel uncertain as you’re pulled in opposite directions by compelling offers that meet differing needs.
Perhaps the highest bidder hasn’t sold his current house yet, making the closing timeline uncertain. Or none of the offers are quite right, but you’re hesitant to ruffle any feathers with a counter offer. What’s a savvy seller to do?
It seems like you’ve got a million options, but we’ve broken it down into four main courses of action:
- Accept the best offer and reject the others.
- Ignite a true “bidding war”—individually shop the best offer around and see if anyone will beat it.
- Let all interested parties know that there are multiple offers and invite them to put their best foot forward.
- Counter the best offer and reject the rest.
You can use this guide as a compass to navigate you in the right direction when multiple offers on a house have your head spinning.
Option 1: Accept the best offer and reject the others.
When time is of the essence, and you have one clear stand-out offer, you can opt to speed up the process by choosing to move forward with the winner and reject the rest.
The “best” offer in this case could be the highest bid when your top priority is to get the most money possible from your home, or the cash offer that promises a faster timeline so you can move in time to start your new job.
This method is by far the quickest and easiest route for sellers fielding multiple offers on a house because you can get under contract and take the next steps to closing that much faster, which alone will be a 30-45 day process.
Plus, if the thrill of a little drama isn’t your thing, accepting the best offer and moving on with the sale might be the no-stress, no-mess approach you’re looking for.
Finally, even if you were to go through a few rounds of counter offers with interested buyers, there’s no guarantee that you’d shake out a better deal anyway.
Figuring out what the “best” offer is won’t always be as straightforward as you think in a bidding war.
Oftentimes going with the highest bid seems like the obvious choice. However, within each purchase contract, a host of contingencies can obscure what the buyer is actually offering and whether the sale is a sure thing or could potentially fall through. So you have to weigh all the terms in addition to the price.
According to HomeLight’s Top Agent Insights Survey, issues related to the home inspection (12%), buyer financing (6%), and appraisal (3%) were the most common culprits for closing delays. If a buyer can waive any of these, their offer strengthens. Special contingencies like the deal hinging on whether the buyer sells their existing home can also weaken an offer.
Plus, you never know what you could negotiate for if you don’t try. But if you’re OK with potentially leaving some cash on the table for the sake of simplicity, this might be a good approach for you. Otherwise, you might be better off stoking the coals a little bit before making a final decision.
When it’s a smart move:
“If they had an offer that was outstanding and met all their needs, I can’t see a situation where the extra two or three days to get the counteroffers back would make a huge difference,” said Gabby Taylor, a top selling real estate agent in the Redlands, California area.
Option 2: Ignite a true ‘bidding war’—individually shop the best offer around and see if anyone will beat it.
According to the National Association of Realtors who sets the ethical guidelines for the real estate industry, “purchase offers generally aren’t confidential.” When you receive an offer from a buyer, you (and your listing agent) have no ethical or legal obligation to keep it a secret.
NAR instructs home buyers: “In some cases, sellers may make other buyers aware that your offer is in hand, or even disclose details about your offer to another buyer in hope of convincing that buyer to make a ‘better’ offer. In some cases sellers will instruct their listing broker to disclose an offer to other buyers on their behalf.”
This type of scenario marks the makings of a true bidding war.
In a multiple-offer scenario, you hold the power. Why not use it to negotiate the best possible offer?
Some buyers will be turned off by the aggressive negotiation strategy and walk away from the situation. In the event that no one wants to play your game, you’ve lost your multiple-offer moment.
When it’s a smart move:
Your agent will know whether buyers in your market can traditionally stomach the stress of a bidding war. In competitive cities filled with high-profile business professionals and a fast-paced way of life, it might be the best way to go. But that might not be in the case in smaller towns or cultures where people put a premium on being polite and easy to work with.
Also, if you only have one good offer, then this option is off the table. You can’t create bidding wars with bad offers, even if you have multiple bids.
Option 3: Let all interested parties know that there are multiple offers and invite them to put their best foot forward.
You can ask your buyers to come forward with their “best and final” offer without revealing the specifics of your best offer at the moment.
This approach essentially leaves you fielding a round of new offers without having to wonder if your buyers will go any higher given a little more time.
“While you’re waiting for the other, lower offers to adjust, you can call the highest offer and let them know that you are expecting higher offers and if they’d like to seal the deal they might want to come in with their ‘highest and best’ now,” says top-selling Seattle agent Aaron Hendon.
This puts a little extra pressure on each buyer to sweeten the pot. Plus, it allows sellers to retain more control over the terms and pricing of their home.
Though less aggressive then the “shop around” option, some buyers won’t love the uncertainty of not knowing where they stand and may choose to remove themselves from the offer pool.
When it’s a smart move:
When you don’t have a clear-cut favorite offer on the table, this can be a powerful way to draw out better offers from motivated buyers. Think of it as reshuffling the deck in your favor.
Option 4: Counter the best offer and keep a few waiting in the wings.
Let’s say one offer is a clear favorite, but you just need to iron out a few contract details. In this case, you might want to counter the best offer to see if you can get the terms you want, keep a few others waiting in the wings, and reject the rest if they’re lacking.
Here’s an example:
One of your buyers bid $500 over asking (the strongest price from any others in the group) and only requested the standard home appraisal and home inspection contingencies. However, you’d stipulated in your disclosures that you’d like to take your expensive five-burner gas stove with you in the move.
In their offer, the buyers asked you to leave the stove as part of the contract. You refuse to budge on this item and so you counter back to accept their price and terms, but under the condition that you keep the stove.
You’re fairly confident they just threw in this request as a “let’s see how much they care” gesture and have fallen in love with your house…but you keep a few other buyers waiting in the wings to be safe.
This approach lets you negotiate an almost-perfect offer. You can let the buyer know that you’ve got a few other interested parties, but you’d like to move forward with them if they’ll meet these terms.
You’ll have the opportunity to iron out the kinks in good faith, while keeping a few interested buyers waiting in the wings. If negotiations unexpectedly go south, you’ve got a backup or two.
There’s not a whole lot of risk with this option, but note that buyer’s offers do come with an expiration date, so you can’t keep them waiting forever.
When it’s a smart move:
If you’re fairly certain you’ll be able to iron out the kinks in your most appealing offer, or just have one small ask to make, go for it (so long as your agent agrees). There’s no need to drag out the drama that can come with getting multiple offers on your home if one of them already takes you halfway to your destination.
Cut through the chaos to see the big picture.
It can be a little intimidating when your beloved home becomes the popular kid on the block, but these tips can help you stay grounded throughout the selling process.
In a high stakes situation like this, order is your friend. And what’s more orderly than a spreadsheet?
Put your buyers’ names in left-hand rows and offer details in the columns, including offer price, contingencies, closing date, net to seller, and anything else that’s important in your sale. Check out this handy guide to handling a bidding war for more information on how to keep yourself organized.
Assess your priorities.
In some cases, the highest offer might not necessarily be the right one.
“Price isn’t always what the seller is looking for,” said Taylor.
“In the case of a house I just had, we did not accept the highest offer. We went with one that was slightly below because we were worried about the appraisal not coming in, and none of the offers had enough cash to bring in if it didn’t come in.”
In this case, Taylor advised her client to accept an offer that would allow them enough time after escrow to move into a new place with more cash and fewer contingencies.
Use your greatest resource: your agent.
Your real estate agent can act as a north star when you’re navigating the waters of fielding multiple offers on a house. They know what works and what doesn’t in your market, and can guide you to make the best decision for your unique situation. You might not be an expert on juggling a multiple offer scenario, but your agent is.
At the end of the day, there is one final option: reject all the offers on the table. But if you have multiple lowball offers or decide none of them are even worth countering, then you have to ask if 1) you’re overpriced or 2) you’re being unrealistic with your demands.
“Even if it was a really low offer, I would never not counter it, because it’s a very powerful thing to be able to do multiple counter offers, to push people to get the most money for your seller,” said Taylor.