Back Up Offers - A Brief Tutorial

Do Backup Offers Have to Be Higher Than the List Price?

Whether your backup offer needs to be higher than the asking price depends on how many offers the seller receives. In a multiple offer situation, you can be fairly certain there will be offers for more than list price. This is how many multiple offers go:

Whether your backup offer needs to be higher than the asking
price depends on ow many offers the seller receives.

• First offer: less than list price, because the buyer doesn't know anyone else is interested.
• Second offer: List price, because often the first and second arrive close together.
• Third offer: Slightly more than list price, because the buyer really wants the home
• Fourth offer to 10th offer: Somewhere in between because these buyers know it's a long shot.

The seller has an incentive to stick with the first buyer's offer, especially if it's a higher offer. But you are saving the seller time and trouble by submitting a backup offer, so the seller might be willing to accept a little bit less to give you an incentive to wait. But if multiple offers are the norm, it's generally best to match the offer on the table.