One of the most frustrating experiences a buyer will ever have to deal with is losing a house you’ve fallen in love with because the seller didn’t accept your offer for some reason. Emotionally, you were all prepared to own that home, and mentally you started moving the furniture in, and picking out the new paint and drapes. Then, suddenly, it’s all gone.
Some buyers respond to this by retreating to the world of rental apartments, never to be seen looking at homes to buy again. That’s not a good response, but neither is going all-out and putting in offers on everything you see that just might suit your needs and sorting it out later. Unfortunately, that happens a lot, particularly in a seller’s market. I expect we’ll be seeing more and more of it in the months and years to come.
So what happens when you make simultaneous offers on more than one property? Nothing out of the ordinary, really. The sellers of all those properties are not getting together over coffee somewhere to sort it all out. Each seller is reviewing your offer through whatever lens necessary to achieve that sellers’ goals. Each seller is presuming you’ve made your offer in your own best interests, and will consider that when deciding how to respond.
A seller is under absolutely no obligation to negotiate your offer*. Sometimes a seller will look at an offer, like it, and accept it. When that happens, the buyer’s offer becomes a contract. The buyer and seller are officially “under contract,” and fully obligated to carry out all the terms of that contract. The sticky wicket comes up when two (or more) sellers decide at the same time that the offer you’ve made is entirely acceptable, and they all accept your offers. Suddenly, you, the buyer, are obligated to purchase multiple properties.
I’ll bet that’s not really what you had in mind. Making multiple offers is a risky tactic that can easily backfire.
Now, I know there are many, many ways to get out of a contract. Those escape clauses have been built into the contract to protect the buyer and seller. They were never meant to be abused, and the powers that be have been closing them up lately because they have been abused so much. It’s no longer so easy to just walk away from a contract; there are usually penalties involved, and they can be pretty hefty, probably at least the loss of your earnest money. I’ll talk more about earnest money in another post.
It’s important for buyers to really think things through when looking at properties and making offers. Find one property that works, and focus your attentions on that deal until that home is yours, or definitely won’t be.
What’s next? Take your pick.
Yeah. You should probably do at least one of those things right now.
*As an aside, the whole who-offers-what thing confuses a lot of people. It’s important to note that when a seller places a property “on the market,” it is not being offered for sale. Instead, the seller is making notice to the public that offers from buyers to buy that property will be entertained. Offers — and therefore contracts — to buy and sell real estate begin with the buyer.