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Dealing With Offers When Selling an Apartment

If you price your home right, you should get a good response to your listing.

And, given that NYC is perpetually strong for sellers, you have the market on your side and might need to prepare for multiple offers.

Price it right

No seller can predict how the market will respond to their apartment listing until it’s officially on the market.  Factors like the time of year, the number of competitive listings, health of the market, how you price your apartment and how it shows will all have an effect.

Typically, if the home is priced right – meaning, in line with recently sold comparable apartments in your building or the neighborhood — and it shows well, you should have offers within the first two weeks.

If you choose to price your apartment higher than the recently sold comparable apartments, it will take some time, and you may see some lowball offers along the way.

Multiple offers? Ask for 'best and final'

If you’ve priced your home well, you will know it.  You will get immediate requests for showings, second showings, and a busy open house.  You need to capitalize on early activity.

Those first buyers are typically your best buyers. They are active in the market, monitor the listings daily and spend a good portion of their energy on the home purchase. They are likely making offers and have lost out on other apartments recently.  Multiple buyers who are excited about your property and have some potential desperation motivating them can mean more money to you.

Put a plan in place with your broker. If you start to receive inquiries and offers from multiple people, it’s best for you to have an opportunity to review them all at once, because it provides you with more leverage and control over the process.  Otherwise, you risk receiving offers over a period, being required to keep responding to each, not knowing what else may come and missing out on a good offer in hindsight.

A good strategy is to ask for a “best and final” offer, which means that all interested buyers must come with their best offer on a certain date.  Give buyers enough time to see the apartment, plan their offers and present you with their best and final offer. Buyers will understand that this is their one and final chance to get the apartment.

Two offers with similar terms and price

Can’t decide which offer to accept?  Not a bad problem. If the terms are the same — say two cash offers at the same price — and you’ve gone to best and final, then you need to make a decision.

If you own a co-op, you need to look at the financials of each buyer and ascertain which buyer will be more likely to get past the board.  Look for things like income, debt, and assets to see which buyer is stronger.

Second, understand who the buyer is and how they intend to live in the apartment.  If it is a parent buying for a child vs. an owner who wants to live there, the owner-occupier is more of a sure thing with the board.

If all else is equal, you need to figure out which buyer is more serious.  Given that buyers can walk away from the time they get their offer accepted and the time they sign a contract, it’s not uncommon for remorse to pop up, and buyers sometimes get cold feet.

A good broker earns their keep at this point. As the eyes and ears of your listing, they can tell you who they think is the most motivated and committed to your home.  Let the chosen buyer know that they have a limited time (seven days is appropriate) to get a signed contract back to you and if they don’t, go to the backup buyer.

Send out two contracts

There is a third option when dealing with two similar offers, and that is to send out two contracts.  It’s a risky strategy that could backfire if not handled appropriately. Many brokers will advise against it.  But, if you have two offers and can’t decide which to move forward with, accept them both and see who comes back with a signed contract and deposit check first.

It’s a way to aggressively push the buyers and build some competition, but it could also scare them off especially if you disclose what you are doing. If you do not disclose and you receive one back first, you risk looking like a jerk to the other buyer.  Then, if something happens to your sale, the second offer may be less likely to come back.

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