Should You Use an Offer Escalation Clause?

Chris at Hauseit® (https://www.hauseit.com) goes over the question: What is an Offer Escalation Clause? Should you use an Offer Escalation Clause when making an offer on a home that's got a lot of competing interest or offers?

Save money when buying, selling and renting real estate in New York and Florida with Hauseit. Available in NYC, Long Island, the Hudson Valley and South Florida. Established 2014.
.
An offer escalation clause is seen primarily in real estate markets like New York where offers aren't binding, and only serve as a gentleman's agreement to begin the due diligence process before a fully binding purchase contract is signed.

As a result, offer processes can be a bit of a wild west in markets like NYC, where there's no way to verify the veracity of other offers the listing agent claims to have received.

In a competitive process, a buyer may utilize an offer escalation clause to automatically up their offer by a certain increment in the case where the listing agent receives a higher, bona-fide offer. Typically, the offer escalation clause will also include a maximum cap for the buyer's offer.

Sometimes, the language will state that the buyer will need to see written evidence of other competing offers for their escalated bids to be valid.

As you can imagine, all of this can be quite grey. So is using such an offer escalation clause a good idea since the listing agent will know that you're willing to pay more, and what the maximum you're willing to pay is?

We explore this mystery and explain further in the following video.
.
Hauseit Group LLC, Licensed Real Estate Broker
Tel: +1 (888) 494-8258
Email: [email protected]
_
#hauseit #hauseitnyc #hauseitmiami #hauseitsouthflorida #hauseitlongisland #hauseithudsonvalley #hauseitwestchester #hauseitrealestate #realestate #realestateinvesting #home #propertyinvesting #realestatetips #realestatemarket #realestateinvestor