Key Takeaways

• The highest offer isn’t always the best. Focus on net proceeds after expenses and concessions.
• Fewer contingencies and stronger financing (or cash offers) reduce the risk of the deal falling through.
• A buyer’s financial strength and earnest money deposit signal commitment and reliability.
• Evaluate offers holistically—including price, terms, and timing—and don’t hesitate to negotiate.

---

If you’re thinking of selling your property in the near future, one of your main objectives is probably to get the best price. However, know that getting the highest price for your apartment property isn’t always the same thing as getting the best offer.

Most sellers assume that they mean the same thing. However, an offer could be better than a price.

Focusing solely on revenue could be a huge mistake. There are many other factors you should consider when evaluating offers from different buyers. To determine whether an offer is good, it must be viewed in the context of the embedded conditions, closing date, financing, etc., relative to what other buyers are offering.

At B&R Property Management, we’ve outlined what you should know about evaluating and comparing offers when selling your apartment.

Are You Getting the Best Price for Your Property?

Calculate Net Proceeds

The best offer is the one that leaves you with the most money in your pocket, and that isn’t always the offer with the highest price. To know how much of the offer price you will keep at the end of the day, factor in the expenses that come with the offer.

This includes closing costs, agent commissions, repair requests, property taxes, and mortgage payoff. A lower offer with fewer expenses or concessions may leave you with more money in your pocket. But you won’t know this if you only focus on the offer with the highest price.

Analyze Contingencies

Offers with fewer contingencies carry a lower risk. Contingencies are conditions that must be met before the sale can be finalized. Common contingencies buyers insert in their offers include property inspections, appraisals, financing contingency, and, in many cases, a precondition that the buyer’s current property be sold first.

A buyer can walk away if one of these contingencies is not met, and the risk in today’s climate of collapse is higher with offers that have a lot of contingencies. On the other hand, if a buyer is willing to waive the inspection or appraisal, their offer will be much more attractive.

Mortgage Preapproval vs Cash

Buyers with a pre-approval letter from a reputable lender are less risky. The chances that such an offer will fall through are lower. But buyers with cash offers are the best because they present fewer financing contingencies.

Even if a cash offer is slightly lower, it presents less risk because it doesn’t depend on financing approval. In either case, it is vital to verify that a buyer has preapproval or that they actually have the cash.

A buyer’s overall financial strength is more important than the size of their offer. Keep in mind that most times, you’re better off going with a cash buyer, followed by buyers who are pre-approved.

Closing Timing

A shorter closing timeline may be more valuable to sellers than a higher price. Most buyers in Las Vegas have a timeline in mind for closing the deal. The deadline for closing the deal should not be too quick because it can add unnecessary pressure.

On the other hand, if the closing date is too far away, it could jeopardize your plans or not add enough pressure for buyers to commit. Before accepting an offer, ask yourself if you are happy with the closing timeline.

Earnest Money Deposit

How much a buyer is willing to pay as their earnest money deposit is an indication of their commitment to buy the property. The usual amount is 1%-3% of the sale price, but depending on the market and the buyer’s interest, the earnest money deposit can be as high as 10%.

Because they risk losing their money if the deal falls through, only a committed buyer will pay a strong earnest money deposit. Even if that buyer’s offer is lower than others, they still present a lower risk.

3 Signs an Offer is Strong

1. It’s Above or Below List Price

The offer should align with the current value of similar apartments in your location.

If you’re operating in a seller’s market, it’s normal to expect the offer to be slightly higher than your list price. Any offer that at least matches your asking price is worth considering.

2. There are Few or No Contingencies

If a buyer is willing to waive contingencies like inspection and appraisal, they demonstrate a strong interest in buying the property. It’s also a good sign if a buyer is willing to buy your apartment even if it’s appraised lower than their offer price. These types of offers are more secure because they limit the risk that the deal will collapse.

3. The Buyer is Financially Strong

A buyer who is in a financially strong position will often make a bigger down payment. They will not hesitate to provide proof that they have the full purchase price for the property. They are often more willing to make a substantial good-faith deposit.

Bottom Line

Do not be afraid to make a counteroffer. A counteroffer won’t drive the buyer away if they are highly motivated to buy your apartment.  If you don’t make a counteroffer, you won’t know how much a buyer is willing to pay for your property.

Counteroffers shouldn’t only be about the selling price; you can negotiate other aspects of the offer, such as contingencies, closing costs, etc.

Adopt a holistic approach when analyzing the offers. Look at various aspects of an offer instead of merely focusing on the offer price. To do this effectively, you need an in-depth understanding of your local housing market and the know-how of an experienced property management company, such as B&R Property Management.