Highest and Best Offer Required! Really?

August 25, 2018

Most Realtors have been in the position as the listing agent to be fortunate enough to have a listing that gets multiple offers. If its going to happen it normally will happen within the first 2 weeks of your new listing. As the listing agent its a great feeling to have multiple written offers because in the eyes of the seller your the “Best Agent” and you know you now will have a better chance to negotiate a good and cleaner deal for the seller then if you had only one offer.

That being said I don’t believe there would be much depute that the “I have multiple offers, so I need your highest and best price ” is not always the case. It can be true but it also can be true that it’s also used to knowingly manipulate the agent to unknowingly manipulate their buyer to increase their offer without knowing if the sellers agent really has multiple offers or not.

I’ve shown properties where certain offices and or agents almost always guarantee that the listing agent or team member will tell you they are now working on another contract for the listing you want to see. Or when you advise you will be submitting an offer they tell you they have another offer in the works. Or when you submit an offer on a property where there has been no indication of an interested party you almost immediately hear they have another or multiple offers and so they need our highest and best price.

Now I know this “Multiple offers scheme” isn’t always true because many of these just in demand properties remain on the market weeks after we walk away to look at others

Just recently I was showing a property where the listing agent team member never mentioned anything about any other interest in the property, its normal when there is to give some indication of interest by others, in this case none. We submitted the offer, it was rejected, the seller agent advises the sellers didn’t want to negotiate and will accept X amount. My buyers agreed to the sellers price, the sellers agent says great and then within one hour instead of telling us we have a deal were told they now have two other offers so they need our highest and best. My buyers upped their price and the agent told us immediately we had a deal and it was signed by the sellers. My buyers were very upset because they know they were played for over $10,000 to get the property, I was upset because I know this is the MO for that office and there is nothing that can be done about this flim flammery. Let me say that I’m not aware of any real recourse one has concerning this matter because its hear say ” He said she said” with no real tangible proof of deception.

Based on my experience this is not an isolated incident and something should be done by NAR to curtail this unethical practice. I’m not sure what kind of requirements should be in-acted by NAR. IMO if a selling agent tells you they have multiple offers NAR should require it be in writing to the buyers agent and NAR should also require the listing agent keep the written offers on file for x days in the event the buyers broker wants to determine if there were actual additional offers as the listing agents advised.

Recently NAR has provided Realtors with forms dealing with Multiple Offers. Their use is voluntary, meaning clients and or Realtors are not required to use these forms if they so chose. While its a step in the right direction they should be required, which would be the only way to help insure that when we’re told “there are multiple offers” we would have some form of reasuurance that its true.

There is a saying “That which you tolerate you encourage” right now NAR tolerates these practices and so these practices are used by some agents as a closing tool to the detriment of buyers. Its not fair, its not right, its bad business and IMO unethical.