Should you accept the first offer?

A quick first offer is any seller and estate agent’s dream. In reality, though, it is not always that straightforward.

According to agents from Seeff, offers to purchase come in all shapes and sizes and knowing when to accept is not always an obvious choice for sellers.

For example, the highest offer is not always the best because it might come with contingencies and conditions, and the best offer is not always the highest price.

If a prospective purchaser offers to buy a house at the full asking price with minimal conditions attached, then it is almost a no-brainer that you would accept it.

But it is seldom that straightforward.

That said, in terms of assessing your asking price, research shows that the first offer is often the best, but it might come with conditions.

How to choose an offer

Choosing an offer with the least potential for delays is always a better bet, but it depends on the circumstances.
So, when should you accept the offer?

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Seeff’s agents offer these tips:

• If it is a cash offer with no contingencies attached. However, cash offers are typically not the highest. It may, however, mean that you can sell quickly and move on. If the offer is for the full asking price or higher (which may sometimes be the case) and there are no challenging conditions or contingencies attached.

• If you need to sell in a hurry and the offer is not quite what you are looking for, you could accept it to save time and not risk that another offer might not be forthcoming.

• If finance is the only contingency and the buyer has been pre-approved for such, that provides some comfort that the deal will go through fairly quickly.

• If the buyer puts down a substantial deposit. That usually indicates they are serious and likely to secure the finance needed for the purchase.

• If work on the house is needed or it is a fixer-upper, and a buyer is prepared to take it “as is” at an acceptable price, even if it is a bit lower than expected.

While a good offer should be close to your asking price, market conditions play a key role. If the market is booming and plenty of buyers are competing for properties, the seller can be choosier. However, if it is a buyer’s market and there are fewer buyers and offers, the seller should take care and not just dismiss any offer, especially if they need to sell.

Importantly, in most instances, the offer to purchase will include a clause – the 72-hour clause – which enables the seller to continue marketing the property so that they do not miss out on a potentially better offer.

Should such a bona fide offer be made by a second buyer, the seller must give the first buyer written notice that allows them 72 hours to either fulfil or remove the suspensive conditions and proceed with the purchase.

Alternatively, the first buyer can elect not to proceed, and the seller is then free to accept the offer from the second buyer.

(Info: www.privateproperty.co.za/writer Gina Meintjes).

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