What to do in a multiple offer scenario

Journal, Property Market, Sales, Sellers,  Journal,  Principals,  Salespeople

It is a daily occurrence for real estate agents to balance the interests of, and duties owed to, their seller clients; whilst at the same time providing assistance to third party buyers.

In this article, we take the opportunity to examine a real estate agent’s obligations in a multiple offer situation and provide some best practice tips to assist agents in their dealings with their seller clients and potential buyers.

Agents caught in the middle of a multiple offer situation must ensure that they comply with their obligations to both their seller client and the potential buyers.

Section 22 of the Property Occupations Regulation 2014 (Qld) (PO Regulation) provides that an agent must act in accordance with their seller client’s instructions unless it is contrary to the conduct provisions of the PO Regulation or otherwise unlawful to do so.

In addition to this, there are numerous provisions of the REIQ Standards of Business Practice which are relevant in a multiple offer situation. Article 4 provides that Members must:

“…(b) act in the best interests of their Client and act in accordance with their instructions except where to do so would be contrary to Statute Law;

(c) act ethically, fairly and honestly when dealing with all parties so as to minimise controversy and to not prejudice the reputation of the Institute and/or the Members;…

…(f) act in a manner that is professional and courteous, and that does not disadvantage existing negotiations;…”.

Article 9(a) prohibits Members from making false or misleading representations or statements about properties or businesses, or from engaging in any conduct which is likely to mislead or deceive; whilst Article 9(b) states that Members must not participate in any harsh or unconscionable conduct with respect to the marketing, sale, rent or leasing of properties or business.

Further, the Australian Consumer Law (ACL) prohibits conduct, in trade or commerce, which is misleading or deceptive, or is likely to mislead or deceive.  Agents must, therefore, exercise a degree of caution insofar as ensuring that any representations which they make in the course of marketing a property are accurate and not likely to mislead or deceive.

Failure to comply with their obligations could potentially lead to a claim against an agent for misleading and deceptive conduct, prosecution for a breach of the Property Occupations Act 2014 (Qld) (PO Act) and PO Regulation and/or an appearance before the REIQ Consumer Complaints Tribunal for breaching the REIQ Standards of Business Practice.

Practical advice for agents

Given the competing obligations faced by an agent, it is often difficult to know the best course of action to take when confronted with a multiple offer situation.

Agents have an obligation to immediately inform their seller clients of all offers, act in accordance with instructions from their seller clients and to obtain the maximum sale price for the property. However, in obtaining the maximum sale price for the property, agents must treat potential buyers honestly and fairly and not engage in misleading or deceptive conduct and/or unconscionable conduct.  Conduct which may be considered misleading or deceptive and/or unconscionable can include, but is not limited to:

  • an agent playing potential buyers off against each other in an attempt to draw out further offers and drive up the sale price; and
  • an agent advising a buyer of the existence of a higher offer in circumstances where a higher offer does not exist, has lapsed, or has previously been rejected by the seller.

It is important that agents are aware that if either of these scenarios were investigated by the Office of Fair Trading following a complaint from a potential buyer, the agent would have to produce evidence of the existence of the other potential buyers and higher offer.

If an agent receives multiple offers to purchase a particular property, the agent should inform the potential buyers that multiple offers have been received and obtain a written acknowledgement from the potential buyers that they have been advised of that fact. In this regard, an Acknowledgement of Multiple Offers Form is available via Realworks.

This approach alerts the potential buyers to the existence of other offers and provides them with an opportunity to make an increased offer to purchase the property if they wish. In this situation, agents should ensure that no pressure is exerted on potential buyers to increase their offer as this may be considered to be high pressure tactics, harassment or unconscionable conduct.

In circumstances where an agent has received multiple offers from potential buyers, before the seller has executed a written Contract of Sale, it is recommended that the agent advise their seller client of the offers and discuss the following course of action as one method to handle a multiple offer scenario:

  1. Advise the potential buyers that the seller has received other offers before they have executed a written Contract of Sale. In disclosing the existence of further offers, agents should be mindful not to disclose any details of the offers to the other potential buyers;
  2. Approach the potential buyers and provide them with a timeframe within which to provide their best and final offer to purchase the property;
  3. The offers are to be sealed and then presented to the seller;
  4. If the agent has been instructed to advise the potential buyers to submit their best and final offer, it should be stressed to the seller that these offers should not be used as a means to commence further negotiations with the potential buyers; and
  5. A written acknowledgement should also be obtained from the potential buyers that they have been informed of the multiple offers.

If the seller considers this course of action to be appropriate, the agent should ensure that they obtain instructions from their seller client in writing. Agents should also ensure that they keep detailed file notes of their conversations with their seller clients and all potential buyers.


It remains the seller’s prerogative to provide instructions to an agent regarding the course of action he or she wishes to take in a multiple offer situation. However, agents should always remember that whilst they must act in accordance with their seller clients’ instructions, they ought not to do so if those instructions are contrary to the PO Regulation or are otherwise unlawful.

This article was first published on 21 November 2019.