Counter Offers above list price- The Rules/Laws

[DSU Trailblazer]

I had a question regarding seller counter offers. I was always under the assumption (which is probably wrong, which is why I'm asking) that sellers and the agent were not allowed to counter at a higher price than the listing price? The work around has always been the "submit highest and best" offer. But I thought there was a rule that a seller could not ask specifically for an amount higher than the list price if someone offers them full or over asking price?

Also in the contract analysis section, how detailed do you get with offers, BCO's, and SCO's?

 

[sputnam]

It may vary from state to state however, there is no law requiring a Seller to sell at or below the list price. The asking price is just the starting point for negotiation.

 

[J Grant]

I am not aware of such a rule, but call your local RE board and ask!
In my state, buyers can offer above, below, or at list price. A RE agent told me that in the case of competing offers, the agents are not allowed to reveal the buyers bids to each other, so it is not where agent tells Bob, that Suzy bid 212 so you should bid 215. They each put in their highest and best

You might be confusing it with a rule, ( if there is one in a listing agreement -where a seller might only pay a commission based on the agreed on list price rather than any higher offer. ?

There are weird rules around commissions and how they are enforced, also each listing agreement can be personal to that owner and RE brokerage firm

 

[Restrain]

The agent is required to present any and all offers to the seller. There is no restriction on the price offered. In fact that would be ‘price fixing’ which is against the law in virtually every jurisdiction. The offer can be lower, equal to, or higher than the asking price. Bidding wars on properties in certain markets are common. In my market we are seeing $15-20K bumps in bids over asking price, pushing 10% or more over asking.

 

[Russ Kitzberger]

Buyer has no entitlement to having their offer accepted, list price for them is point of negotiation. Some states might be different.

In most areas it creates a listing contract commission-related issue, the broker is entitled to the commission if they bring a ready willing and able buyer at terms the seller is willing to accept.

In practice, it only works if the seller just refuses to sell to a cash buyer above list, without contingencies.

In the case that the seller receives a cash offer at the list price or above, without any contingencies, then just decides not to sell, then the broker can ask for the commission. If it is co-brokered, or co-operatively brokered per most MLS rules; seller's broker and buyers (selling) broker can ask for commission.

One Exception is auctions without reserve at pre-stated terms.

 

[Ken B]

It would be extremely rare for a buyer to offer cash with absolutely no contingencies in any form. And there's the loophole.

 

[Russ Kitzberger]

It would be extremely rare for a buyer to offer cash with absolutely no contingencies in any form. And there's the loophole.

I have done that. Fully escrowed the cash to close as earnest deposit. During boom, would see it in REO and auction. With the lines outside of houses waiting to get inside for showings, should be making a comeback. You gotta play to win.

 

[Bob Ipock]

Done every day in North Carolina. Right now it is 40%-50% of the time and $38% of sellers paying some amount of seller concessions of over $1,000.

 

[glenn walker]

No

I had a question regarding seller counter offers. I was always under the assumption (which is probably wrong, which is why I'm asking) that sellers and the agent were not allowed to counter at a higher price than the listing price? The work around has always been the "submit highest and best" offer. But I thought there was a rule that a seller could not ask specifically for an amount higher than the list price if someone offers them full or over asking price?

Also in the contract analysis section, how detailed do you get with offers, BCO's, and SCO's?

Not correct- You are confusing a contract price "V" A listing price-way back in the day-someone perpetrated a belief that if I listed a property at say $500,000 and if a buyer offered me all cash no with concessions that I was bound to accept his offer. In 1979 when I became a Realtor some dunderhead actually taught us that. The Listing is not a contract with a potential buyer-it's only an-offer to sell. Therefore until a actual Purchase Contract is ratified by both buyer and seller the list price has no bearing on the final outcome and it can be higher or lower. FLIP-THE COIN OVER BUT-BUT-BUT how can it be lower if the list price is $500,000 and the buyer offers $475,0000 ?

 

[Elliott]

Restrain said, The agent is required to present any and all offers to the seller.

Old war story, when I bought a oceanview lot 40-years ago. Told my agent to write a full price offer and one $2000 higher than full price. There was also another offer being presented at the same time, which was $500 over list price. When it was my agent's turn to present my offer she reached into her brief case and pulled out the one that was $2000 over full price and that offer was accepted by the seller. The lower, full price offer was not presented.