There are some differences between standard home sales and FSBOs (for sale by owner), but in most cases the differences are minimal, one being, that the offer, counter offer and negotiations are done directly with the owner. In many cases, the one thing that makes it tricky to gauge is that most homeowners do not tend to behave in a uniformed manner and may present a slight variations from what is expected compared to if an agent was in charge of the sale.
Offers and Counteroffers
The biggest point of concern, which is not necessary a bad thing, is the counteroffer process. Counteroffers are a subset of contract law, and one should always keep this in mind when engaging in one. The first thing to remember is that, unless explicitly outlined in the document, a counteroffer completely voids and ends the original offer. When one party changes the terms of the original offer, it is considered a counteroffer, and all parts of the original offer are not considered to carry across to the new offer. As such, when making a counter offer for homes for sale by owner, the first tip you should be aware of is that if you are only changing one aspect of the offer, make sure to list all other terms to be part of the new offer.
The Quantum of Change
Courts do not recognize the variation in value to determine if the change in terms and consideration is a reason to invalidate or uphold the original offer. As such, even a change in price of one cent is considered a counteroffer. Non monetary terms are also part of the offer process. If the offer includes kitchen appliances or lack there off and a change in the buyer's requirement can constitute a counteroffer. As such, the second tip you should abide by is to include the necessary provisions in any changes you make and notify the seller, that you are not counter offering but rather enquiring if he would be amenable to change. The language in which you draft the enquiry should be explicit so that it does not change the spirit of the offer.
Reverting to an Earlier Offer
Once an offer has been countered, the original offer is considered void and it is possible for the seller to now seek other suitors. One party does not have an obligation to the other. The seller is not obligated to entertain the counteroffer. This is one of the tricky situations for sale by owner properties. If you want the property bad enough but are just trying to sweeten the deal, tread carefully. A misstep could put your dream home into someone else's hands. Note that once a counteroffer is posed, and if the seller rejects it, returning to his original offer is not always possible. The seller is under no obligation to activate the earlier offer. Doing so is purely under goodwill on his part.
The process of offers and counteroffers are not mere negotiating strategies. There are points of law invoiced and not just law that covers real estate issues. A significant point of contract law is part of the scene. Keep that in mind when making a counter offer.
