Most buyers and sellers don’t grasp the level of artistry that goes into negotiating a contract to buy or sell a home.
“Highest and best offer” implies one thing (but can mean something entirely different). Google anyone? Definition? “Highest and Best” IMPLIES giving one’s best shot… but often it’s idle chatter… at least in Miami. As a seller, whether you take an offer like that at face value or challenge it depends on the circumstances (and it depends on you!). It depends upon how you ‘read’ the buyer and the other Realtor, and whether you believe them. The meaning of ” HIGHEST AND BEST OFFER” R-E-A-L-L-Y depends on who’s uttering the words, their level of sincerity… and their willingness to play Russian Roulette. The number of offers prefaced like that is astounding: I just wrapped up two – for property listings I had in Miami:
“HERE IS OUR HIGHEST AND BEST OFFER”
“OUR BUYER WON’T QUALIFY FOR FINANCING IF THE PRICE GOES ABOVE THIS”
1) Both homes SOLD … for MORE ! 2) One seller COUNTERED… despite being told the BUYER WOULDN’T BUDGE. 3) The other seller DECLINED the offer. 4) Both buyers came back with higher offers. 5) Both homes SOLD for well above the “HIGHEST AND BEST” initial offer.
Is that always the case? No. You run the risk of losing a (sincere) buyer if you misread the offer or fail to negotiate it properly. From what I’ve seen, the vast majority of buyers and sellers don’t grasp the level of artistry that goes into negotiating a contract to buy or sell a home.
“Highest and best” is frivolously tossed about. Sometimes it’s a lame negotiation attempt (a scare tactic). Other times a buyer (or Realtor) plays that card, without realizing how much they really want the house until later…
Stakes change as negotiations move forward. Home buyers can and do find additional resources, when push comes to shove. It’s not uncommon.
Buyers make offers… based on their resources… on what they think the property is worth …and according to what it might appraise at.
Realtors submit offers as ‘highest and best’ because they believe it… or because it’s true … or because they are liars! Funny thing about ‘HIGHEST AND BEST OFFER’ : Sometimes even the person making the statement isn’t really sure what it means.
1) Whether the seller counteroffers (or not!) buyers sometimes raise their bid! 2) Other times, that buyer moves on – and finds another house.
You need veins filled with ice water to “negotiate”… You need to read body language and you need to be able to determine the level of sincerity. You need to size up the buyer and the other Realtor (Most of us know one another already… Miami is cosmopolitan… but we’re a small town when it comes to selling real estate!) … and you need to love negotiating! Negotiating real estate is partly about price…. PARTLY! Occasionally contracts are refreshingly clear cut. More often, they’re riddled with terms, contingencies, question marks and ‘outs’.
Highest and best offer? There’s often a question mark following that statement… and sometimes there’s considerable room to negotiate. There’s more to negotiating the sale and purchase of real estate than just price. When you’re ready to buy or sell call me!
For more information on buying and selling real estate in Miami … tips for buyers, sellers, information about Miami neighborhoods, community information, moving , schools, Miami market conditions, contact Esslinger Wooten Maxwell Realtors Vicki and Alexandra Restivo here or through the MiamiRealEstateCafe.com Blog.
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