Posted by Renee Porsia under For Buyers, For Sellers, For Realty Professionals, General Information, RE/MAX, selling, buying, Renee Porsia, NAR, Philadelphia Market Statistics

I can't tell you how many times I called a listing agent to tell them I was going to be writing an offer for my buyer on one of their listings and heard "how much is it" or "I'm expecting 2 offers" or my personal favorite "It better be good because I have 2 other offers." 

First of all, expecting offers isn't "having" offers. Also, lets remember that it's not the listing agent's home and therefore the listing agent shouldn't be making comments like "it better be good because I have two other offers." It makes the agent look bad. What they should be saying is "Great, the more the merrier."

The agent was hired to obtain offers not to discourage offers and by making those comments, they could wind up costing their seller a very good, strong offer and in this market, offers are hard to come by.

How could those statments ruin a good offer? Well, by making those statements to the buyer agent, the buyer agent will go back and tell their client exactly what the listing agent said and therefore the buyer could wind up backing off on their offer because they do not want to wind up getting into a possible bidding war or feel that his/her offer might not be high enough to compete with those "other" offers.

Don't get me wrong, there are ways of calling an agent's bluff when they say they have other offers and I have no problem calling them on it when they make those comments to me.

So, how can a buyer agent call a the bluff of a listing agent you ask? Well, there is my all time favorite weapon called an "Escalation Clause." Essentially the Escalation Clause can be thought of in the context of plaing poker and showing your hand. Basically, the clause says that the buyer will increase his/her offer in little increments of whatever the buyer chooses but not to go over a certain price if the listing agent has another offer that is the same as the buyer's or higher. So, for example if the listing agent has another offer of $200,000 and the buyer's offer is $200,000. With the Escalation Clause the buyer's offer would increase in increments of $500.00 which will increase the buyer's offer to $200,500 but not to go over the offering price of $210,000. Many Realtors are unaware of the Escalation Clause and many do not understand it. I however like to use it when absolutely necessary.

So, you may be saying "what if the listing agent just says they have another offer. How can the buyer be certain there really is one?" Well, the Escalation Clause states that the buyer has the right to see that other "offer" or "offers." How great is that??

Another way the listing agent could ruin a good offer for their seller is to take offense to the Escalation Clause written into the Agreement of Sale on behalf of the buyer which by the way, was written into the Agreement of Sale by the buyer agent in order to "PROTECT" his/her buyer from the listing agent's statments about having other offers. The listing agent in essence gets angry that the buyer agent called their bluff for simply doing their job.

I am not saying every Realtor behaves this way but there are many who do. What they fail to realize is that their comments can hurt their seller and that is not why they were hired.

To ensure the Realtor doesn't ruin ANY offers for their client, the Realtor should practice self-control,discipline, professionalism and tact.  They should also keep in mind that every offer no matter how large the sale price or how little the sale price its not for them to decide which offer is the best offer for their client. Every offer should be presented no matter what.

To make certain your Realtor doesn't say the wrong thing and wind up discouraging buyers from writing offers on your home, be sure to set the rules right up front when you hire him/her. You can tell them not to say anything to the buyer agent that could be taken the wrong way.  You can tell them you want them to encourage buyer agents to bring offers not to discourage them and put it right into your listing agreement what you expect from your Realtor.

This is your home and you deserve the right to decline, counter or accept all offers.