The real estate market in Portland is on fire right now. There are a lot of homes and condominiums to buy as well as a lot of buyers on the market. We've seen a few homes sell for over asking price and multiple offer situations. Because of this, buyers often ask if the highest price offer will naturally get accepted.
The short answer is no. There are so many other terms and details to a real estate purchase and sale contract an offer that the highest price doesn't necessarily mean the best offer.
Take for example a recent transaction we had. Our seller has listed their home for $425,000. It was a popular home in the Beaverton neighborhood and because of the great schools, we had multiple offers. Within the first week, we had six offers on the table. Four of them were over asking price and two of them had escalation clauses. These escalation clauses can be included from a buyer stating that the buyer will pay over asking price up to a certain amount over the highest priced offer in incremental chunks. For instance, one of our escalation clauses came in stating that the buyer will pay up to $15,000 over asking price in a $3000 increments over the highest offer. So if an offer came in at $430,000, this buyer is willing to pay $433,000, $3000 over the highest asking price up to $440,000. Naturally, our sellers assume this is the best offer but with more careful consideration, this offer with an escalation clause also included contingency, which means that the buyer needed to sell their own house first before agreeing to buy this house. To the offers were full asking price without contingencies or escalation clauses and one of them waived the home inspection.
We ended up going with an offer for $430,000 with no contingency, no inspection addendum, and the buyers were already preapproved for financing. They didn't need to sell another house and were ready to move in within 30 days. We gave up going for the higher price for the better terms.
Of course, the seller has the ultimate decision on which offer to take, but in going over all the details, this one made the most sense. Sure, we want our sellers to get the very most out of their home, but if frustration, contingencies, and roadblocks or obstacles prevent a quick sale, this can of far outweigh simply accepting an offer for a little bit less money.
For more answers to your real estate questions feel free to give us a call at any time or start your online search here for free or contact us for a listing consultation.