The buyer has the right to buy more than one condo, if they can afford them. While a Realtor might have a suspicion that the buyer who made more than one offer was planning to take only one deal, you really can't say. If it is the buyer's position to make offers to see who is more willing to negotiate and they want it kept quiet, who can tell me that it is ethical to insist that they reveal their strategy? It's loosy-goosy ethically and I would advise against multiple offers but for more practical reasons, as I have.
The other issue that has reared its ugly little head is the one-page "offer." The one page "offer" is not an offer. It is not a letter of intent. It is a note that says, if you like the price written here, and we can agree to all the other terms found in a contract, I would likely sign a sales contract. This note is not binding.
The real offer come in the form of a contract that the offerer has already signed that spells out EXACTLY the price, terms and conditions for the sale of a property. In most states, the person receiving this offer, upon signing it and returning it, binds the original signer and him/herself to a sales agreement that will end, as quickly as possible in the transfer of the property. That is the only real offer that can be made and what I imagined Goodie716 was discussing. As far as the "offer" to make an offer, I would say fire away, they are not binding and if you get five acceptances, you may wish to firm up one real offer of a complete contract. One page "offers," in my opinion are just talk and talk is cheap.
In fact, that's a good way to end this little exercise. Talk is cheap. Don't cheapen yourself by too much of it. Sellers are bargaining in good faith, for the most part, and so should you.
As Jennie said and I said as well, sequential offers are a good way to keep things straight. It would be as much to the buyerâ€™s benefit as the sellerâ€™s, if we did not gum up things with more than one offer at a time. Ken says in his eyes it is unethical to make two offers simultaneously and indeed, there may be precedent that says so in the Realtor organization or perhaps the state authority has already agreed that this is so. I donâ€™t know that they have but I too would prefer not to â€œgo thereâ€ with multiple offers.
Iâ€™m surer that it would be unethical for me to get a buyer committed to do things that would cost him/her money in lost deposits and in ill will and which might cost him/her that deal that was truly the best they could get.
Lots of luck
While I ususally agree with Bill, and would to the degree that there is no law requiring agents to disclose when our clients have requested we make multiple offers on multiple properties, I do believe this disclosure in keeping with the code of ethics. I know I would want this information.
Reading through the posts below, some good information has been provided particulary by Bill Holt and Jeanne.
Bill states an important point: when the offers go to attorney review, if they go to attorney review, they can be rejected for no reason with an attorney merely stating the following- I do not approve of this contract. This statement effectively ends the deal.
As Jeanne suggests, I too would suggest placing the offers sequentially in order to avoid an adverse response on the sellers end.
In my own addition I would suggest figuring out which one you are more interested. Compare all the relevant features and then weigh with your agent the value of those features. Also consider which owner seems more negotiable. Go after that one first.
Artyom and Natasha
Unfortunately, you have received advice from out of state people as well as from in-state Realtors. The out of state people know nothing about New Jersey law and their advice is just plain wrong.
In New Jersey, we have a unique situation where, for three days AFTER the contract is signed, your attorney can cancel the deal. No reason needs be given. So, if you get positive answers from both offers, you are free to cancel one. Now, before you even get to a contract, you can negotiate back and forth with NO obligation but whenever the offer is from you (as opposed to a counter offer from the seller, which is yours to accept or reject,) you can't tell when the seller may say yes. He does so by signing the contract that you have already signed, perhaps only after you sign changes or addendums but at some point the fully signed contract, with changed initialed, is delivered. Then the three days attorney review starts with the right to cancel.
If you don't cancel one, you may be on the hook for two condos. There are still usually contingencies and you may not meet them, especially the one about obtaining a mortgage, if you canâ€™t afford the two condos, so you may have a later out as well. At some point, you may have significant deposit up and you may, indeed, lose that money if you renege after the attorney review period without cause. So, be careful.
As far as disclosing that you have two bids up, I personally know of no law that insists that you do such a thing. You might want to consult an attorney, who will be able to tell you more about the laws of the state and the meaning of specific language in a contract. If the contract that you offer says you have the funds to complete the deal and you really can't afford two condos, that may open a reason for a lawsuit for falsely stating that you can, indeed, pay for the condo, given that you may end up with more condos to pay for than you can afford or even want.
There is also the fact that if you start horsing around in this fashion, you may want to have special language in the contract to act as an escape hatch. It certainly wouldn't hurt. For that, you'll need an attorney to draw up the contract language for you. A Realtor cannot do that. It will cost you money to get it done.
As you can see, it's getting complicated. I would not wish to be the broker handling your bidding, that's for sure.
It would probably be a lot simpler and it would definitely be a lot clearer if you handle the bids in a sequential fashion. Set a time limit on your bid. (This is not always done, by the way.) If you don't get something going with the first, switch to the second. That way you'll know "who's on first."
I know you want to get the best deal that you can. I still think that you will have to rigorously pursue one at a time to truly see if you have the deal that is best for you. If the condos are alike, it may be easier to do two or more at once but if there are significant differences (first floor, second floor, end unit, new appliances, newer carpet, upgraded flooring, window treatments, etc,) there you are, trying to figure out if an extra $1,000.00 changes your mind. Then you may also find that the better unit has an owner who is less willing to bargain. Then what do you do? Take the better unit at a higher price or go cheap?
You see, merely making multiple bids does not promise to make your decision any easier or any better.
Best of Luck
Ask yourself - what am I trying to accomplish? And will my approach help me succeed?
"Unwavering Commitment to Service"
Search the MLS at http://www.feenick.com
The sellers probably would not bring suit against you as they know that even if the courts back them up you'd still not have the means. It's highly likely that you would have to surrender your earnest money for those contracts you failed to honor.
"Unwavering Commitment to Service"
Search the MLS at http://www.feenick.com