This practice is often done with different types of major purchases: cars, businesses, and yes (we know) houses! Is this a good idea, especially when it comes to a house for sale by owner? Let’s take a look at this concept.
There are times when a FSBO will receive multiple offers on their home. In that case, they have some ways available to deal with this. One way is to let each potential buyer know that there ARE other offers for them. They can even “play a game” of telling other prospects when a counter offer is made. One important thing this will do is increase the selling price of your home. The logic is that whoever wants it enough will pay the highest price for you. This is almost like being at an auction. In this type of scenario, letting potential buyers know about other deals is a good thing.
However, before you use this type of strategy, you need to understand the negative effects this could have on your sale. If one or more of your prospective buyers feel they have already offered a fair price for your home; continuing to play this game could only aggravate them. You may end up with everyone upset with the process and NO ONE buying your house. Then YOU will be the loser, as potential buyers will probably go elsewhere.
Something else about a FSBO entertaining multiple offers on their home and telling other buyers about them is this. Both the seller and the buyer are at risk of missing out on a great opportunity. This is an especially good point for other potential buyers in a multi-bid situation. Be sure to tell them about all the great features of your home, garden, and neighborhood. Don’t leave out any important details. Let each prospect know what they’ll be missing out on by abandoning the process. Remember, they most likely already see your home as a “can’t refuse deal.” Then they could end up just as disappointed as you if they miss out on buying your home.
One thing you can do to make the most of multiple offers for your home is to be prepared in the first place. BEFORE you get started as a FSBO, do some research on this scenario. Go to relevant websites, talk to experts, find out how you should best handle this concept; in case it comes up. Practice your negotiation techniques of this type beforehand, then you will be ready to face him. Another thing you can do is get to know each potential buyer when you start bidding. Find out about any limitations they may have financially or even mentally. Perhaps their personality type makes them averse to this type of negotiation agreement. You’ll want to know that before you tell them about other offers. The best advice you can receive on this subject is: be prepared!
