What Does Buyer Come Back With "Highest And Best" Mean?

By
Real Estate Agent with Premiere Property Group,LLC Portland Metro & Suburbs Oregon

 

 

What Does Buyer Come Back With "Highest And Best" Mean?

Here in the Portland Metro area our home inventory in general is pretty low at 3.9 months. There are some neighborhoods that are very hot and the inventory Portland Signis less than two months. As a buyer purchasing in this market it will be fairly common to be in a multiple offer situation, especially in these neighborhoods. I'm actually seeing quite a lot lately things like "listing agent will be presenting all offers on " so it doesn't matter if your offer is in earlier than the others.

Depending on how many offers there are, most listing agents (at the request of the sellers) will often send an addendum out notifying the buyers of the multiple offers and asking that they come back with their "highest and best" offer. This is just as it states, so it's not the time to hold back thinking that the seller will still be countering. This is their counter.

I often get the question "Without knowing what the other offers are, how do I know what my highest and best should be?". Of course at this point I've already run the comparables so you know if the asking sales price is good for the neighborhood or high. I've also spoken to the listing agent to see if I can get any info out of them as well as asking what terms would be more suitable to the seller that may set your highest and best offer over the others. 

My response is usually "Offer what you would feel comfortable with knowing that the seller might not take your offer". This can also be something other than price as the other aspects of an offer terms can be just as important. You might want to raise your earnest money amount, or change the close date or offer a seller rent back. If you know it's doable, you can also reduce the days of your home inspection and of course there is always the sales price. Of course there is the option of just sticking to your original offer as well. At this point, the seller will review all of the highest and best offers and except one..or perhaps counter that one with some fine tuning details, or except none. 

Give me a call if you're thinking about buying or selling in our crazy Portland market. I'd be happy to guide you through this process!

 

 

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Knowledgeable, Approachable, Service Oriented

Cindy Westfall ABR,GRI

Premiere Property Group,LLC

5000 Meadows Rd., Ste. 150, Lake Oswego, OR 97035

Cell: 503-819-5241      

E-Mail: cindy@cindywestfall.com

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Disclaimer: All views on my blog are my own and may not reflect that of Premiere Property Group. All pictures and content are my own unless otherwise noted. Please No Copying without my permission.

 Cynthia Westfall is licensed in Oregon State

 

Comments (12)

Andrea Bedard
Thompson Company, REALTORS® 240.593.2860 - Silver Spring, MD
Fluent in German and Real Estate * M.A. ABR ASP

Hi Cindy, highest and best = an offer that leaves you with no regrets! I tell my buyers that they should still be comfortable with their offering terms and if it doesn't work out they should not be saying if only I had offered ..

Mar 30, 2014 11:21 AM
Cindy Westfall
Premiere Property Group,LLC Portland Metro & Suburbs Oregon - Tualatin, OR
ABR,GRI Your Tualatin & Portland Metro Real Estate

Hi Andrea, exactly! It's not the time to hold back, but offer what you would have not regrets walking away with. It's quite hard as many buyers feel that they are "playing their hand" and might pay lots more than the other offers.

Mar 30, 2014 11:24 AM
Rob D. Shepherd
Windermere/lane county - Florence, OR
Principal Broker GRI, SRES

Highest and best offer means the fishing trip is over. Fish or cut bait.

Mar 30, 2014 11:32 AM
Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate

Cindy, in my market I recommend buyers write their highest and best right out of the gate.  When I am the listing agent I indicate the same with a comment "do not expect seller to counter." 

Mar 30, 2014 11:33 AM
Cindy Westfall
Premiere Property Group,LLC Portland Metro & Suburbs Oregon - Tualatin, OR
ABR,GRI Your Tualatin & Portland Metro Real Estate

Hi Rob, Well said! Speaking of fish, I enjoyed a VERY delish fresh tuna sandwich for lunch. Thank you!

Mar 30, 2014 11:45 AM
Cindy Westfall
Premiere Property Group,LLC Portland Metro & Suburbs Oregon - Tualatin, OR
ABR,GRI Your Tualatin & Portland Metro Real Estate

Hi Kathleen, That was the very advice I told my buyer today. We are up against at least one offer and perhaps two more in by the end of today. Not the time to fish as Rob says. Gotta just go for it at this point. Hopefully there won't be a need for the "highest and best" round.

Mar 30, 2014 11:47 AM
Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Cindy, these comments are interesting. I am going to be doing this because there is absolutely no more room on an offer that I'll be making for a buyer, that's pretty straight forward; cash, close in 10 business days. It's a horrible property with great potential (but MUCH to get it up to even being permitted by the county) and my investor doesn't mess around. The seller just wants to be cashed out and he even lives in another state, so I'm figuring he better TAKE IT. 

Mar 30, 2014 12:36 PM
Cindy Westfall
Premiere Property Group,LLC Portland Metro & Suburbs Oregon - Tualatin, OR
ABR,GRI Your Tualatin & Portland Metro Real Estate

Hi Gayle, Sounds like a good offer to me! Fingers crossed! With multiple offers, you just hope YOURS is the one excepted!!

Mar 30, 2014 12:58 PM
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Always a tough call for the buyer, Cindy.  And, it really depends on how badly they want the home.

Mar 30, 2014 09:25 PM
Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Hello Cindy,  I hear this so often and always wonder what the other offers are that I know how to advice my clients.  Suggested.

Mar 31, 2014 01:53 AM
Jill Sackler
Charles Rutenberg Realty Inc. 516-575-7500 - Long Beach, NY
LI South Shore Real Estate - Broker Associate

Cindy, another winning post. Best suggestion you can give is, as you said, offer something you're comfortable with.

Apr 01, 2014 01:45 AM
Cindy Westfall
Premiere Property Group,LLC Portland Metro & Suburbs Oregon - Tualatin, OR
ABR,GRI Your Tualatin & Portland Metro Real Estate

Hi Jill, thank you. I've been seeing this quite a lot lately, so thought it was blog worthy!

Apr 01, 2014 11:26 AM