Happy seller overwhelmed by a stack of purchase offers, each more enticing than the last! They can already picture themselves heading to the bank, smiling ear to ear.
Still, there's a slight furrow in their brow, a hint of concern on their face. Should they accept the first offer? How can they turn down those adorable children whose photos accompany a particular offer? And what deadlines do they have to sort it all out?
In today’s market, where the shortage of properties for sale is glaring, the phenomenon of multiple offers is everywhere, and it can be overwhelming. Thankfully, you can count on your broker's expertise and sound advice to navigate the process!
Your Broker's Responsibilities
First, it's important to know that the terms purchase offer and promise to purchase refer to the same thing. The official form from the Organisme d’autoréglementation du courtage immobilier du Québec (OACIQ) is called the Promise to Purchase, affectionately nicknamed "the PA" in the industry.
Your broker is the one who receives these PAs. They are obligated to present all of them to you, even the most unusual ones. They must do so impartially, without prioritizing based on the collaborating broker, the order of receipt—since no such priority exists—or the circumstances under which they were submitted. Ultimately, all decisions rest with you.
Your broker is also required to inform collaborating brokers or buyers that other offers are on the table, without revealing their contents.
This obligation, dictated by the Real Estate Brokerage Act, is a hot topic these days. Some argue that blind bidding drives up prices. They advocate for transparency, citing Norway as an example, where properties are openly auctioned, much like works of art. In Norway, bidding wars are even conducted via simple text messages! While this is a political debate we’ll steer clear of, it’s worth noting that the government currently has no plans to legislate in this regard.
When faced with multiple PAs, you have three options:
- Accept one of the promises to purchase;
- Make a counteroffer to one of the buyers;
- Or reject all of them.
It’s also worth knowing that as long as an offer hasn’t been accepted or rejected, a buyer may want to improve it using the Enhancements Before Acceptance form.
When and How to Decide?
Every offer comes with a deadline, typically between 24 and 72 hours, though this detail is at the discretion of the parties involved. This is the time you have to review each offer. Remember: it’s not just the price that matters—conditions are just as important. Moreover, ensure the buyer is serious and has the necessary funds to proceed with the purchase. In most cases, a serious buyer will include a deposit with their promise to purchase.
If the acceptance deadline expires or you don’t respond, an offer becomes void. However, you can still make a counteroffer afterward. Since a counteroffer is essentially a new promise to contract, it can be presented even after a PA’s expiration.
And be cautious of verbal agreements—they are considered binding contracts! A signed document will simply formalize the agreement.
They say the devil is in the details... especially in those of a PA. That’s why, now more than ever, it’s crucial to have an experienced broker by your side. I’m here to assess the impact of the conditions in each PA, help you analyze the information they contain, and manage the various deadlines associated with them.
