Ask Phyllis: a blog series of frequently asked real estate questions.
The Art of the Counter Offer
Dear Phyllis,
After years of reading your real estate advice, I have a question. My son and his wife recently made an offer on a condominium. It was very underpriced, and there was a total of twelve. The seller’s agent only responded to the three highest offers. When my son checked the final selling price, he was surprised it did not sell for higher. It sold for $950,000; he was prepared to offer $1,000,000. I wonder why the seller’s agent did not respond to all buyers.
Janice
Dear Janice,
Thank you for being a longtime reader and for sharing your son’s experience. His situation highlights the complexities of managing multiple offers. Mastering the counter offer process is key to maximizing price in a hot market.
In competitive markets, sellers often price homes below market value to attract interest. As a result, multiple offers can quickly follow. However, how the seller’s agent handles these offers depends on their strategy, experience, and the seller’s preferences. Some agents choose to narrow the field, issuing counteroffers only to top contenders. They do this to simplify the process, avoid overwhelming the seller, or focus on buyers with strong financial commitments. Yet, as you pointed out, this approach can leave money on the table if other buyers—like your son—were willing to go higher.
I take a different approach. In multiple-offer situations, I counter all buyers and invite them to submit their “highest and best” price. This strategy increases the seller’s chances of securing the best price and terms. In your son’s case, this method could have led him to submit his $1,000,000 offer, possibly driving the final price above the $950,000 sale. While we can’t know why the seller’s agent limited counteroffers, they may have underestimated buyer interest or prioritized efficiency over maximizing offers.
That said, even without a counteroffer, your son still had options. He and his wife could have directed their Realtor to reach out with a stronger offer. In a hot market, buyers sometimes take this initiative.
I wish your son and his wife the best in finding their dream home!
