Question: What’s a reasonable response time from a seller after I’ve submitted an offer? Is there a way to set a response deadline?
Answer: I usually set expectations at 24-48 hours for a response on an initial offer and always ask the other agent how responsive their client is and to let me know if they expect a response to take more than 48 hours. If the seller is on vacation, in a difficult time zone, or pushing 100 years old it’s completely reasonable for a response to take more than 48 hours.
In order to set a deadline, you’re committing to voiding your offer by a certain time if no response is provided. There are two ways to do this. First (this is my preferred method), your agent can provide notice in the offer email that the offer expires at a specific date and time if no response is received. Notice voiding the contract should be sent immediately if the deadline passes without a seller counter or acceptance. The other option is to include a clause at the end of the Residential Sales Contract stating the same. I’m not a fan of this option because a sleuth of an Underwriter (person who approved your loan) may come back and ask for proof that a response was received by the deadline and you could have some issues if it wasn’t.
Fishing With Your Offer
Aside from being anxious to hear back from the seller, the main reason you don’t want the response time being dragged out is to prevent your offer from being used as bait for competing offers. You can count on most sellers’ agents contacting interested parties to let them know about the offer in order to encourage multiple offers.
While I don’t recommend setting a deadline on every offer you make, it’s a good idea if you think your offer is being used as bait to fish for other offers or if you want to close the deal before an Open House. If a property is new to the market and likely to have multiple bids, you’ll want to find out if the seller’s agent is accepting offers as they come in or if there’s an offer review deadline.
Keep in mind that if you set a response deadline and then decide not to void the offer if the deadline passes without a response, you’re giving up a lot of leverage in the negotiations, so be sure to think through the decision fully beforehand.
I hope this was helpful! Please keep your questions coming for future columns!