Sunday
November 23, 2014

Speak Up When Offer Arrives

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Speak Up When Offer Arrives

To avoid misunderstandings, listing agents should not delay communications with sellers when a buyer makes a bid.

Question: How much time does the listing agent have to present an offer to the seller on a property once a buyer makes an offer? Can the listing agent hold the offer knowing another offer might be coming in?

Answer: Standard of Practice 1-6 speaks directly to the timing of the presentation of an offer. “REALTORS® shall submit offers and counter-offers objectively and as quickly as possible.”

While there can be different perspectives on what “as quickly as possible” means, it’s clear from the Code of Ethics that the listing agent doesn’t have the right to decide unilaterally when an offer is presented. The listing agent must always keep the key concepts of Article 1 in mind. “When representing a buyer, seller, landlord, tenant, or other client as an agent, REALTORS® pledge themselves to protect and promote the interests of their client. This obligation to the client is primary, but it does not relieve Realtors® of their obligation to treat all parties honestly.”

The presentation of offers is one of the ways in which a listing agent “protects and promotes” the interests of the seller, so the agent should take instructions from the seller on how the offer is presented.

It’s possible the listing agent and seller jointly agree on a negotiation strategy in which the seller decides to wait for other offers to be presented. However, the seller should be told the risk of doing this. State contract law may allow a buyer to withdraw an offer before a valid acceptance, so the seller could be left with nothing to consider. As a courtesy and as part of the negotiation, the seller and listing agent should discuss and decide whether to tell the offering buyer of the seller’s decision to wait for another possible offer.

In my view, “as quickly as possible” means the listing agent should notify the seller immediately of an offer so a dialogue can begin between them about when, where, and how to present it and other offers. Certainly, with today’s array of technology, there are few barriers to communicating an offer to the seller as soon as it has arrived.

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