As the market continues to heat up many agents are facing a scenario where multiple offers are presented on their listings.  Handling multiple offers can be challenging and there is a very real possibility of ethics and possibly legal violations if one is not careful.

When multiple offers exist, does the listing agent have to disclose this fact to the buyer's agent?  (Disclaimer:  each state may have different laws or guidelines pertaining to multiple offers, the following relates to Florida and NAR guidelines.)   

Listing agents need to do as instructed by their clients, the seller as long as it is a legal instruction.  If the seller advises not to disclose the presence of multiple offers, the listing agent can't disclose.  Should the seller agree to disclose, then the agent should disclose the presence of other offers.  It is up to the seller if the terms of the offer are to be disclosed also.  If the presence of offers is authorized by the seller, than the source of the offer must also be disclosed.  It is unethical and possibly illegal to disclose to one party and not another.  Disclosures are to be made to all or no one.

So, what strategy is best?   How does one advise the seller?  In foreclosure situations, it's normally a non-issue as the bank/lender will have on their listing agreement terms to allow agents to solicit and disclose multiple offers.  In short sale situations, it is still up to the seller, as in normal sales.  There is no one strategy for all scenarios, and a wise agent should advise depending on the circumstances of the sale. 

In a market and property where investors are shopping for the best bargain and there is little to no emotional attachment to the property, the reality of multiple offers can discourage the buyer, who will just move on to the next investment, if there's lots of alternatives on the market.

For end user's where the buyer is naturally trying to get the best terms, but there is the strong possibility of an emotional attachment to the purchase, disclosing the presence of multiple offers could result in a higher sale price for the seller.  But, once again, the conditions dictate the situation.  If there a re numerous similar homes at competitive prices, buyers may just go on to the next one and avoid a bidding war.

So what are your thoughts?  How have you handles multiple offers?  Has it been successful?

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