In the world of real estate, offer day is a crucial moment for both buyers and sellers. It is the day when potential buyers submit their offers for a property, and the seller reviews them to decide which one, if any, to accept. There are two types of offer dates: planned and spontaneous. Understanding the dynamics of both is essential for a successful transaction.

Planned Offer Presentation

A planned offer presentation is when the seller sets a specific day and time to review all offers. For example, the seller might state, "offers will be reviewed on Tuesday at 6 pm". Typically, there is an 'offer registration' time a few hours earlier, say 4 pm on Tuesday. Registering an offer essentially informs the listing agent of your intention to submit an offer. This is crucial as all buyers must be informed of the number of competing offers.

The listing agent will then update all interested parties about the number of offers, allowing buyers to adjust their offers based on the level of competition. A buyer facing several competing offers might offer more money or better terms than if there was no competition. If a buyer submits an offer without registering, the listing agent must disclose the new offer to all other interested parties.

Once all buyers and their agents have been notified, the seller and listing agent proceed to review the offers. Sellers may value certain terms more than others (price, conditions, closing dates, etc.), and if there are several offers, this process can take a few hours. That is why the irrevocable time that buyers put on their offer is typically set for later that evening or, in some cases like estate sales, a few days after the offer presentation date.

After the seller decides to accept an offer, the listing agent sends the accepted agreement back to the successful buyer after obtaining the appropriate signatures. It is crucial that the successful buyer is communicated with BEFORE the irrevocable time. If the seller accepts the offer within the timeframe but cannot notify the buyer, the offer is considered null and void.

Spontaneous Offer Presentation

A spontaneous offer presentation occurs when a buyer submits an offer on a property open to offers at at any time. The seller typically prices the listing at the expected offer value in this scenario and will often ask for anywhere from 12 to 72 hours irrevocable to review the offer. All other interested parties (those who have seen the property or provided feedback indicating interest) must be notified that an offer has been received and will be reviewed. The other interested buyers then have an opportunity to submit their offers, and the rest of the presentation carries on like a preset offer date.

Another example of a spontaneous offer presentation is when a 'bully offer' or 'pre-emptive offer' is received. This is when a buyer submits an offer before the requested date. These offers usually lack conditions and significantly exceed the asking price, encouraging the seller to move up the presentation date and accept the offer before future buyers can compete. 

In this case, all interested parties must still be notified of the offer to allow for a chance to submit a competing offer. Similar to a preset offer day; all parties must still be notified of the number of offers. For example, if a second and third buyer submit offers with the bully offer, the original offerer and both additional buyers will be notified that there are 3 offers in play. 

In summary

Offer day can be a tense time for both buyers and sellers. Understanding the dynamics of planned and spontaneous offer presentations can help you navigate this critical stage of the property transaction process. Remember to communicate openly with your real estate agent and stay informed about the number of competing offers. And most importantly, make sure you are comfortable with what you are offering because you just might win! Good luck :) 

If you are unrepresented and want a full service agent to help you win in competitive real estate markets like Kitchener-Waterloo, contact me today at Curtis.ja.ball@gmail.com or by phone; 519-497-5923. I have a vast network of highly qualified agents across North America that will be your greatest asset in moving to a new home or securing a long term investment.