So you’re in the market right now in one way or another - Buyer, Seller, Renter, Landlord - and you’re looking to move fast but not lose your butt in a price negotiation… The X and Best Offer is a way to establish a firm stance and let the other side know that you’re serious and want to make a fair deal fast.

X and Best - BUYER style…

When you’re thinking of X and Best with a Buyer, you’re thinking of HIGHEST and Best offer.  This is the "I want to buy your house, not come on and let me" move.  It establishes the final word on what the Buyer is willing to offer to the Seller and says "There is too much inventory to keep going back and forth - accept or I’ll find another house to buy"

Scenario… Buyer offers $100,000 on a Listing of $120,000.  The Seller thinks "We’ll meet in the middle at $112,000 or so"… The Buyer says, "The house is worth $108,000 at most".  We’re $4,000 apart.  The Seller counters the $100,000 with $119,000 thinking they will draw up the big in bigger increments.  The Buyer says, "$108,000 Highest and Best Offer"…

Whoa!! I thought I was going to get $112,000!!!

The Buyer has drawn the line in the sand and said, "Don’t play games, this is what the comps indicate the house is worth thanks to my trusty Buyer’s Agent David Podgursky @ Boca Executive Realty… so let’s close this puppy at $108,000."

So what’s a seller to do??

1) Say no and move on.  In this market, not necessarily the best choice.  This is not a market where you’re going to see a sales record for a property so if $108K is what it comps for, then that’s what the Appraiser is going to say and no one will pay more than appraised value in a Buyer’s Market.  Also, if this is the first or only offer - how much is it costing them to say no and pay carrying costs for a few more months??  By that time it has eaten up the $4K difference in where they wanted to be in the first place!!

2) Say "Lowest and Best" of $112K- an interesting move… but it is a move that would probably backfire.  The negotiating "gurus" think you should always let the other side kill the deal… so countering the Highest and Best with a Lowest and Best is not a strong move… unless they are VERY close together… then it is "I can’t take $108K - $110K is breakeven for me and that’s the best I can offer… in which case $2K shouldn’t blow the deal.

3) Say yes… if the number works, right now actually getting a deal is a rarity so if the deal makes sense, waiting for the next one may not make sense.

X and Best - Seller Style…

Well… the Buyer side really shows how the whole idea works… but for a Seller, Lowest and Best might be "I know what it is worth and I don’t HAVE to move so don’t I am going to let you steal it"

Seriously… some sellers don’t NEED to move - they WANT to but when the economy is what it is, Wants and Needs have to be carefully calculated.

Lowest and Best for a Seller is a concession.  I have seen a transaction recently where the Buyer put in a great and logical offer. The seller needed to be rid of the property so they wrote a "Lowest and Best" offer to try to wrap everything up without the back and forth.  It worked and the price that they offered was more than fair.

Sellers sometimes do "Highest and Best"… really, really!

Banks often do this strategy.  They have 4 offers and they pick the top two.  They are slightly different - one is a higher dollar with more contingencies and one is a lower offer but not with out its own weaknesses in structure.  They tell the listing agent to inform the top two bidders to submit their Highest and Best offers… whoever comes out on top gets the house.

This shows that banks realize that sometimes they really are below the market and they want to get the house off the books ASAP.  Distressed properties are not great comps to conventional properties… so they know that when they’re under market that they can just end the speculation in a hurry and move on.

X and Best - Tenant Style…

So you’re looking for a great rental property and you see the house you want to rent.  It IS the best on the block and the landlord knows it.  Unfortunately, the landlord thinks that his various upgrades mean his property is worth an additional $300/mo!

I tell my landlords that having a nicer place or changing the carpet out for tile may get their property rented FASTER but that doesn’t mean it is worth more money per month than Market Rent dictates!!

So a Tenant may write a Contract for Lease at $100 over Market Rent… say $2000/mo.  The Landlord might counter $50 off of his original price… $2250.  The Tenant may think they’d really like to have Granite Counters but it is just for a year so they can deal without them.  So they’ll say $2050 Highest and Best.  They know they’re paying $150 over the other units but getting a much nicer place.  The landlord then needs to realize whether it is worth it to him or not to take $200 LESS or sit empty and cost him X per month until he gets another rental offer.

X and Best - Landlord Style…

This is most common with Apartment complexes… there’s really no flex there.  They hit a certain occupancy rate and they’re content to wait for those last few people that will pay full boat…  Sometimes they drop below where they want to be thanks to signing 50% of their leases in a 2 month period (which means 50% of their leases expire simultaneously) and they’ll offer incentives to get people into those units and get back to their magic occupancy rate that corporate wants them to maintain.  Otherwise they’re ALWAYS saying "This is our Lowest and Best Offer… there’s someone else there waiting for that unit so make up your mind before they sign on the line"

In a private owner scenario…someone may just lowball the rent or offer something that doesn’t make sense.  For instance - someone comes in and says "I want to pay you $400 under your rent AND I don’t want to pay for the first month"… the Landlord might want or NEED to clear a particular number to pay the mortgage… so they say "Look - I can do it for $200 under my asking price but I won’t budge on the first month"… there’s a concession but then a take-it-or-leave-it.  Believe it or not … in this market you WANT to pay a little higher to make sure your landlord CAN cover the mortgage or else you could both be out of a property!

With a listed rental property, most Landlords want 1st month, Last month and Security deposit… and they may flex on the rent rate - but if you can’t pony up the advance monies, then don’t bother them.  Lowest and Best offer on that is firm from the get-go.

Why did I feel the need to spread this love?  Because in this market, this negotiating strategy is not only commonplace - but it is widespread.  It is something that we need to recognize as happening out there so we know what to do when it happens to us in our transaction.

If you have any questions or need help in your Florida Real Estate transaction, please contact me at
davidp@bocaexecutive.com or my cell phone at (561) 504-6949

For More Information on Boynton Beach & Lake Worth Florida Real Estate and Mortgages, please contact

David Podgursky Broker Associate & Licensed Mortgage Broker Boca Executive Realty  & Boca Executive Mortgage 561-504-6949 cell DavidP@BocaExecutive.com Your Full Service Source for Residential and Commercial Real Estate and Mortgage Loans in Florida