This is a house I put on the market late Friday evening. I own it with a friend. It is fixed up pretty nice, which is why we had over 25 showings scheduled. We got 7 offers on it. We had two more interested buyers, but when I told their agents we had multiple offers, they didn’t want to join the bidding war.
You’d think it would be an easy thing….picking which one to accept. There is so much more to an offer than just the one with the highest sale price.
The lowest offer was way under the asking price and the buyer wanted us to pay $4200 of their closing costs. When 4 of the 7 offers came in over the list price, that one was rejected with a good laugh. I am glad I got it because I used it to force the next buyer into bringing their highest and best offer.
I had priced the house competitively. I knew that there was not much on the market. I knew we had done a really good job making the house appealing. What I didn’t know was how many buyers there would be. You don’t know that until you list it and watch it unfold in real time.
Most sellers would be thrilled to have offers over the list price. While I was excited, I was also thinking about the appraisal. Anybody doing any type of loan will need to do an appraisal. And I wanted an offer that would result in a CLOSING! All of the loan types the buyers were doing made me nervous about the appraisal. Plus, most of them wanted us to pay their closing costs too.
So, I really wanted a conventional loan buyer. Since we were over the list price already, I wanted somebody who did not need us to pay any of their closing costs. The closing cost issue was a really big deal. Why? because if the house only appraises for the original list price of $138,750 and the buyer needed $3000 in closing costs paid by us, we would only net $135,750. If we have to reduce the sale price to match the appraised value, I don’t want to also deduct the buyer’s closing costs from that value too.
Fortunately the house was so nice that I knew all I had to do was wait until the right offer came in. Once it did, we accepted it.
This is one of many things I take into consideration for my clients. It was fun to do it for myself this time!