Escalation Clause versus waiting to make a counteroffer?

[Anonymous]

You would be a fool to not offer and escalation clause AND waive the home inspection. Unless you have a cash offer, you need to include those to make a competitve offer.

[Anonymous]

Anonymous wrote:Don't do escalation. Agents abuse them and will just tell other buyers that you've made an offer at the top of your escalation. Also, you never know what games are played to trigger the escalation.

In almost all situations, if you don't do an escalation but your offer is competitive, agents will try to get you to counter -- so that's the better route. There's still abuse here (agents sometimes lie and say that there's a higher offer when there isn't), but it's not as terrible.

You have no evidence of that. And it doesn't make any sense, either.

Look, you agent haters talk out of both sides of your mouths. On the one hand, you say all they care about is closing the deal and getting paid. On the side, you say they'll risk closing the deal by playing games. Which is it?

(Not to mention if there's an offer for list or higher, the seller will owe the commission, so why would the agent risk alienating a good faith buyer? It doesn't make sense).

-- No, not an agent, etc.

[Anonymous]

To all those saying "don't use an escalation clause, just make your best offer," the "best offer" presumably is the top of the escalation clause. For example, if a house is listed $1m, and I am willing to pay $1.1m, my "best offer" would be $1.1m. You are saying that I am in a worse position if I offer $1m with en escalation clause of $10k increments up to $1.1m than I would be if I just offered $1.1?

Why?

[Anonymous]

Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

[Anonymous]

Anonymous wrote:Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

Time limits are pointless if you actually want the house.

[Anonymous]

Anonymous wrote:Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

And then the seller will just counter offer with the escalation amount. Take it or leave it, not all sellers want to play these stupid little games. Make your offer and be done with it.

[Anonymous]

Anonymous wrote:Escalation clauses are for suckers. That gives the seller an incentive to wait as long as possible to shop for better offers. It is better to make a good offer upfront and give them a short deadline to decide like 24 hours. If they are not willing to do that you would have gotten screwed using an escalation clause anyway, so just move on and find another property.

My agent advised me against using short deadlines when buying. However, as a seller, I have to admit that it probably would have worked on me when I sold this past summer. I was very uncertain about the value of my house and anxious to be done with it. Thinking back, there was a number that I would have accepted if it came in on the first day with a deadline. Over the next few days, lots of bids came in and I ended up getting 23k more than that number.

[Anonymous]

Are buyers still waiving all contingencies and paying over asking price? Maybe I got lucky last November, but my cash offer for 2% under list price with an inspection contingency got accepted. I'm now living in my new-to-me 1980's Arlington 2BR condo. 😀

I bought this as a place to live for the next decade, so I'm not really considering it as an investment to make money from.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Don't do escalation. Agents abuse them and will just tell other buyers that you've made an offer at the top of your escalation. Also, you never know what games are played to trigger the escalation.

In almost all situations, if you don't do an escalation but your offer is competitive, agents will try to get you to counter -- so that's the better route. There's still abuse here (agents sometimes lie and say that there's a higher offer when there isn't), but it's not as terrible.

You have no evidence of that. And it doesn't make any sense, either.

Look, you agent haters talk out of both sides of your mouths. On the one hand, you say all they care about is closing the deal and getting paid. On the side, you say they'll risk closing the deal by playing games. Which is it?

(Not to mention if there's an offer for list or higher, the seller will owe the commission, so why would the agent risk alienating a good faith buyer? It doesn't make sense).

-- No, not an agent, etc.

Actually, it happened to me. Agent told me that there was a higher offer and asked if I wanted to make a new offer. I declined and withdrew my existing offer. House was still on the market a couple weeks later without being contingent/pending.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Don't do escalation. Agents abuse them and will just tell other buyers that you've made an offer at the top of your escalation. Also, you never know what games are played to trigger the escalation.

In almost all situations, if you don't do an escalation but your offer is competitive, agents will try to get you to counter -- so that's the better route. There's still abuse here (agents sometimes lie and say that there's a higher offer when there isn't), but it's not as terrible.

You have no evidence of that. And it doesn't make any sense, either.

Look, you agent haters talk out of both sides of your mouths. On the one hand, you say all they care about is closing the deal and getting paid. On the side, you say they'll risk closing the deal by playing games. Which is it?

(Not to mention if there's an offer for list or higher, the seller will owe the commission, so why would the agent risk alienating a good faith buyer? It doesn't make sense).

-- No, not an agent, etc.

Actually, it happened to me. Agent told me that there was a higher offer and asked if I wanted to make a new offer. I declined and withdrew my existing offer. House was still on the market a couple weeks later without being contingent/pending.

This same thing happened to me

[Anonymous]

Anonymous wrote:Are buyers still waiving all contingencies and paying over asking price? Maybe I got lucky last November, but my cash offer for 2% under list price with an inspection contingency got accepted. I'm now living in my new-to-me 1980's Arlington 2BR condo. 😀

I bought this as a place to live for the next decade, so I'm not really considering it as an investment to make money from.

Ya, not surprised. Single families are much more competitive, especially in certain neighborhoods.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

And then the seller will just counter offer with the escalation amount. Take it or leave it, not all sellers want to play these stupid little games. Make your offer and be done with it.

Why would I accept the seller’s counter at the top of my range? Show me bid that triggered the escalation.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

And then the seller will just counter offer with the escalation amount. Take it or leave it, not all sellers want to play these stupid little games. Make your offer and be done with it.

Why would I accept the seller’s counter at the top of my range? Show me bid that triggered the escalation.

Depends how badly you want the house, I suppose. My spouse is an agent, and I can tell you for certain that there are many times when a potential buyer won't get a chance to improve their offer. So if you want the house, make your best offer up front. The advantage of the escalator is that you get to this, but shouldn't have to "overpay" if no one else is close to your max bid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

And then the seller will just counter offer with the escalation amount. Take it or leave it, not all sellers want to play these stupid little games. Make your offer and be done with it.

Why would I accept the seller’s counter at the top of my range? Show me bid that triggered the escalation.

You would accept the bid because you want the house. I'm speaking from personal experience as a seller and from hearing about the same thing playing out with others. There doesn't need to be a claim that another bid triggered the escalation. If the house is good, and you express willingness to pay a high dollar amount, expect to get called out on it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Escalations are fine, but require proof of written offer that triggered the escalation (they will remove personal information). Verbal offers do NOT trigger the escalation - if it's not written down, it never existed.

Also put a time limit on your offer (48 hours max) so they can't shop your offer.

And then the seller will just counter offer with the escalation amount. Take it or leave it, not all sellers want to play these stupid little games. Make your offer and be done with it.

Why would I accept the seller’s counter at the top of my range? Show me bid that triggered the escalation.

You would accept the bid because you want the house. I'm speaking from personal experience as a seller and from hearing about the same thing playing out with others. There doesn't need to be a claim that another bid triggered the escalation. If the house is good, and you express willingness to pay a high dollar amount, expect to get called out on it.

+1

Only agents benefit from escalation. If you disclose what you are willing to pay then seller will surely use that information to make a counter offer.

Best is to just put you offer with a short deadline.