Disclosing an offer
- Thread starter Graham.B
- Start date
don't know but i have had other people's offer disclosed to me, to see if i am prepared to "top it".
i guess - how can you make a higher offer if you don't know what has already been offered. i wouldn't expect the real estate agent would be allowed to disclose who made the other offer, of what their terms of settlement were.
lizzie
my opinion only
i guess - how can you make a higher offer if you don't know what has already been offered. i wouldn't expect the real estate agent would be allowed to disclose who made the other offer, of what their terms of settlement were.
lizzie
my opinion only
Hi lizzie,
Tah for the response - it tallies with what I was thinking.
Am interested in a property and at the open house the agent said I have to disclose to you that it is under negotiation as an offer has been made.
So I asked what the offer was and got the response that she couldn't disclose that. I asked why and her response was it would "taint the negotiation" and it was illegal for her to let me know.
Huh? What the...?
I thought that was bizarre as I can only assume that if I put an offer in she can only now say the offer is rejected as letting me know there is a higher offer would mean she has disclosed information about the amount.
The fact she said it was illegal was the quizzical issue to me as verbal offeres and negotiation have nothing to do with anything - it is the signing of a contract and exchanging that takesitn into legal areas, I thought.
I only wanted to know the amount to gauge whether it was worth considering putting an offer in or not - the house is being offered for near where I think it should be.
Regards
Graham
Tah for the response - it tallies with what I was thinking.
Am interested in a property and at the open house the agent said I have to disclose to you that it is under negotiation as an offer has been made.
So I asked what the offer was and got the response that she couldn't disclose that. I asked why and her response was it would "taint the negotiation" and it was illegal for her to let me know.
Huh? What the...?
I thought that was bizarre as I can only assume that if I put an offer in she can only now say the offer is rejected as letting me know there is a higher offer would mean she has disclosed information about the amount.
The fact she said it was illegal was the quizzical issue to me as verbal offeres and negotiation have nothing to do with anything - it is the signing of a contract and exchanging that takesitn into legal areas, I thought.
I only wanted to know the amount to gauge whether it was worth considering putting an offer in or not - the house is being offered for near where I think it should be.
Regards
Graham
From a vendor's point of view I would be furious if I found out later that someone at an open house had been prepared to pay a higher price if only the agent had disclosed the current offer and given other people the chance to top it. I have myself seen houses sell for a low price and been shocked because I would have been prepared to pay more but being in the dark as to what was happening left me locked out. I cannot for the life of me understand why the agents like to keep their "secrets.
Is it still common to be gazumped?
Some vendors may just want the highest price. It would be nice to hear a REA response to this thread.
I would think that it's important to remember that the offer price is not the only consideration. There may well be attached conditions that may sweeten or sour the offer price eg. Is a $500K No conditions offer better than a $520K offer with a long settlement etc.
Regards,
Kenny
Some vendors may just want the highest price. It would be nice to hear a REA response to this thread.
I would think that it's important to remember that the offer price is not the only consideration. There may well be attached conditions that may sweeten or sour the offer price eg. Is a $500K No conditions offer better than a $520K offer with a long settlement etc.
Regards,
Kenny
Hi all,
Common practice in these parts is not to disclose an offer if it has not yet been presented, or is still in negotiation. If an offer has been presented and knocked back, then that offer can and will be used to let buyers know what the realistic ballpark is.
The reason for not disclosing a "live" offer is simple: it creates a scenario wherein each purchaser pays the most that they are happy to pay for the home. ie: Obtaining a better price for the people we work for - the vendor. Also, other agents in the office won't want to have their offer beaten by $100 by the bloke down the corridor.
Personally, it would seem silly for me to say to someone, "There is an offer on the table at the moment, of $250,000. Can you offer $251,000?"
Instead of, "Ok, one of the other guys here has an offer ready to present. We still have time to join the party, what are you willing to offer?"
Buyer might say, $250,000. "Well, like I said, there is another offer. Would you be happy to walk away and miss out, IF, for example, the other offer comes in at say $253k or $254k?" (Keep in mind here that I DON'T know the other offer is $250k.)
And so I can go on negotiating from there and probably end up with an offer of something like $254,685. Ideally with a 30 day settlement (if convenient to vendor) and with a big deposit paid within a week (or sooner)
Makes much more sense to me to try to obtain the highest price a buyer is willing to pay, rather than a slightly higher price than the other guy. Remember, in general, agents work for vendors.
Regards,
James.
Common practice in these parts is not to disclose an offer if it has not yet been presented, or is still in negotiation. If an offer has been presented and knocked back, then that offer can and will be used to let buyers know what the realistic ballpark is.
The reason for not disclosing a "live" offer is simple: it creates a scenario wherein each purchaser pays the most that they are happy to pay for the home. ie: Obtaining a better price for the people we work for - the vendor. Also, other agents in the office won't want to have their offer beaten by $100 by the bloke down the corridor.
Personally, it would seem silly for me to say to someone, "There is an offer on the table at the moment, of $250,000. Can you offer $251,000?"
Instead of, "Ok, one of the other guys here has an offer ready to present. We still have time to join the party, what are you willing to offer?"
Buyer might say, $250,000. "Well, like I said, there is another offer. Would you be happy to walk away and miss out, IF, for example, the other offer comes in at say $253k or $254k?" (Keep in mind here that I DON'T know the other offer is $250k.)
And so I can go on negotiating from there and probably end up with an offer of something like $254,685. Ideally with a 30 day settlement (if convenient to vendor) and with a big deposit paid within a week (or sooner)
Makes much more sense to me to try to obtain the highest price a buyer is willing to pay, rather than a slightly higher price than the other guy. Remember, in general, agents work for vendors.
Regards,
James.
Last edited:
JamesGG said:
And herein lies the issue. The REA works for the vendor, and hopefully has their best interests at heart. An offer made on a property is still just that, regardless of whether or not it's verbal or written with a deposit cheque attached. Until a contract of sale is signed, offers on their own mean very little legally, and REA's are within their rights not to disclose such information to buyers.
Think from the vendor's point of view for a moment. Would you be happy if your REA was disclosing offers to buyers and conducting a dutch auction? Far better to ask the 2nd buyer what he/she is willing to offer, as per James' post.
Jaque
See that's where it doesn't make sense to me. If I was the vendor, I would want a 'dutch' aution. It would surely get pple to up their price and conditions. Maybe I don't get it?
SS
See that's where it doesn't make sense to me. If I was the vendor, I would want a 'dutch' aution. It would surely get pple to up their price and conditions. Maybe I don't get it?
SS
stickysandwich said:
But wouldn't you prefer to get $10,000 more than the 1st offer rather than an extra $1,000? If the REA leaves it up to the buyer to present his/her best offer more money could be obtained for the vendor.
If, as a seller, you'd prefer the dutch auction technique, then why not simply take your property to auction?
Or, and this method can work well in a hot market, put your property out to tender. Offers inside envelopes can often yield great results for those more popular properties.
If a REA won't tell me the highest offer I walk away.
They lose my business and never find out what I'm willing to pay.
Ditto if someone tries to shift the ground rules of a deal after the deal is done (regardless if the deal was handshake only). Unless it's in my favour of course
Cheers,
Aceyducey
They lose my business and never find out what I'm willing to pay.
Ditto if someone tries to shift the ground rules of a deal after the deal is done (regardless if the deal was handshake only). Unless it's in my favour of course
Cheers,
Aceyducey
Jacque said:If, as a seller, you'd prefer the dutch auction technique, then why not simply take your property to auction?
Though don't dutch auctions start from a high price and work downwards until someone bids, whereas normal auctions start from a low price and work upwards until the second-highest bidder drops out?
Rgds, Peter
Spiderman said:
Hi Peter
Yes, the original meaning of the dutch auction was when the price started high (like at fish markets) and proceeded to go downwards, until the first in with the buzzer (so to speak) won the item/s.
However, in recent times, and particularly in the last boom we've had, the meaning has altered and could apply when more than one buyer was prepared to pay full price for a private treaty property. A Clayton’s auction was conducted by the REA to determine who was prepared to pay the most, but it was a technique that put off buyers and left lots of unhappy customers.
The danger of dutch auctions to buyers usually came in at valuation time, when the lenders were suspicious that the price paid was more than what the asking price was.
Jacque said:Hi Peter
Yes, the original meaning of the dutch auction was when the price started high (like at fish markets) and proceeded to go downwards, until the first in with the buzzer (so to speak) won the item/s.
However, in recent times, and particularly in the last boom we've had, the meaning has altered and could apply when more than one buyer was prepared to pay full price for a private treaty property. A Clayton’s auction was conducted by the REA to determine who was prepared to pay the most, but it was a technique that put off buyers and left lots of unhappy customers.
The danger of dutch auctions to buyers usually came in at valuation time, when the lenders were suspicious that the price paid was more than what the asking price was.
Hi Jacque
I would'nt consider what you are describing as a dutch auction. It is a closed bid "auction" where you present your highest and best bid over and above the asking price, once only.
It is much more common in NZ than here from my experience.
cheers
ani
Hi,
Thanks for the responses.
Have since found out that the property went for $370 000.
We had seriously decided to go to $380 000 but thought, bugger it, didn't want to get into a silly game with the agent. So walked.
The vendor lost $10 000 (maybe more) cos of agent attitude.
I guess there is a lesson in that. It's all good education stuff.
Regards
Graham
Thanks for the responses.
Have since found out that the property went for $370 000.
We had seriously decided to go to $380 000 but thought, bugger it, didn't want to get into a silly game with the agent. So walked.
The vendor lost $10 000 (maybe more) cos of agent attitude.
I guess there is a lesson in that. It's all good education stuff.
Regards
Graham
