I posted earlier this week about a lot that came up in Charleston.. my realtor ( who is awesome) e mails me at a little at 10pm her time.. new lot on a little street I have already built two homes on and have been wildly profitable.. I want this lot its the last one then the street is built out. she docusigns me 5 minutes later all cash close as soon as title can be done.. ( takes a while in those east coast states.. here in the west coast we can have title done same day) but thats another story. by the time I hear from here next morning 2 other offers now we are in Highest and best. So I put in an escalator clause.. thinking my competition may not know of this or their agents.. I offer 2k more than the next highest bid... list price was 150k I would have gone to 180k... on a highest and best.. but i put in I would pay 2k more than then next highest and best.. must provide written proof. the highest and best was 165k and I got it for 167k close in one week.. DONE deal all signed around.. so I saved 13k on my highest and best and beat two other local builders out of it .. LOL.. so kind of proud of myself today.. So for you all in hot markets escalator clause works and may not be known in some markets .

Almost never had an appraisal issue. That is the listing agents responsibility to make sure the house appraises, but if I am on the buy side I will have a conversation with the listing agent to make sure they have experience working with appraisers.

@Jay Hinrichs: You're right about above asking. It depends on the market though. I follow two real estate markets, particularly with foreclosures and HUD homes. In 1 market (much smaller and weaker), if your offer is 1500-2000 more than asking, you're 90% likely to get it. In the second market, Columbus (capital city), I've seen houses with a listing of 35k sell for 15k+!

@Russell Brazil that works.. as I am ALWAYS buying as a principal.. and not repping clients in these deals.. If the number works for me I don't go to far into it. but if I was repping clients I would do exactly what you do.. I know the engineer type buyer would want this type of excellent representation from their agent/ you !!

@Jay Hinrichs When I require my proof of escalation I require the page with the price, the seller subsidy page so I can create a net price, and the page with the other buyer agents name. I ask for these after I am under contract, and I always check with that other buyers agent to make sure the offer was legit. Only once in 14 years did I find that someone provided me with a fraudulent 2nd offer...and lets just say my client made out especially good in that transaction.

@Jay Hinrichs Sorry. I posted without realizing there was a "Page 2" of this thread with my question already asked and answered....duh...

@Christopher Peterson we require copy of the next highest bid or contract with names redacted for privacy... can some on lie and cheat yes. but this is why you are working with listing agents and not wholesalers and unlicensed middle men.. they are not going to risk there licesnes and lie and cheat.

This is a great strategy @Jay Hinrichs. I'm just starting out myself in Portland and have put in two offers. I ended up in second place both times and I would have been willing to go up a bit more. @Chris Parrish knows my pain :) How do you make sure your escalator clause isn't manipulated though? What written proof do you require from the seller, a copy of the next highest offer? It seems like you offering 150k but also telling them that you would be willing to go to 180k would just mean that, surprise, we got an offer for 178k.

how to handle multi offer situation when you really want it

Rocky V.

Rental Property Investor · Arlington, TX · Member since 2012 · 788 posts · 640 votes

9y

Congrats Jay!! I continue to learn from you. Where do you write the escalator clause in? I'm assuming special provisions or is it another contract all together.

how to handle multi offer situation when you really want it

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