Fine Homes in Nine Oh Five
  Re/Max Realty Specialists Inc., Brokerage
Independently Owned and Operated
   
 
betty@bettybart.com
905 828-3434
 
 
 
 
Resources
 
Competing Offers

In certain market conditions, there may be more than one buyer interested in a property. This creates a competing offer situation.  Both sellers and buyers must consider how to respond when presented with a competing offer situation. Working closely with your real estate broker or salesperson will ensure that you understand the process.
 
In Ontario, the seller’s real estate broker or salesperson is required to disclose the number of competing offers to all buyers who have submitted a written offer. However, the terms and conditions of each offer are confidential to the seller and their broker or salesperson.
 
Tips for Buyers
 
In a competing offer situation, buyers may be tempted to offer more for the property than they planned to and/or remove conditions from offers that are intended to protect them.   This may not be the best situation to consider.
 
Before participating in a competing offer situation, buyers must consider factors such as:
 
Offer Price
 
How much can the buyer afford to offer for the property and how much is the property worth? A high offer could enhance the buyer’s chance of success. However, it may not be the best long-term financial decision for the buyer. A competing offer situation does not necessarily mean that a property will sell for more than the asking price. Similarly, an offer that meets or exceeds the asking price will not guarantee that a buyer’s offer is accepted.

 

 Financing
 
Buyers should be aware that pre-qualifying for a mortgage does not safely eliminate the need for a financing condition in an offer.  You should be approved for a mortgage.
 
Home Inspection
 
In competing offer situations, it can be tempting not to include a clause in an offer that makes it conditional on a home inspection. While your offer might be more acceptable to the seller, you may later learn that there are property defects, required repairs or needed upgrades that you weren’t aware of. In some cases, this can be expensive in the short or long-term. Foregoing a home inspection is a significant risk that a buyer needs to carefully consider. You could consider doing an inspection prior to making the offer. You could, also, request this condition for only 24 hours. Your agent should be able to get this arranged quite quickly.
 
Tips for Sellers
 
A seller facing competing offers has to consider how they want to deal with the situation. The seller can decide to: accept the best offer; negotiate with one buyer and reject all other offers; negotiate with one buyer and advise other buyers that their offers are being set aside while the seller negotiates; or reject all offers.
 
Even in a competing offer situation, buyers have other options and may choose not to continue to participate. A seller may attempt to negotiate only to find out that it was the best offer the buyer could present. In the meantime, other buyers have found new properties they are interested in.
 
The seller’s real estate broker or salesperson can provide advice and guidance, ensuring that the obligations and the options available are understood.

 

 
 


  © BETTY BARTUSEVICIUS of Re/Max Realty Specialists Inc., Brokerage
Independently Owned and Operated
 
The trademarks MLS®, Multiple Listing Service® and the associated logos are owned by The Canadian Real Estate Association (CREA) and identify the quality of service provided by the real estate professionals who are members of CREA. Used under license
The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used under license