« Go Back

Help! Two of my buyers want the same house!!

lady justice

By Peg Ritenour, Ohio REALTORS Vice President of Legal Services/Administration

In today’s market it’s not unusual for an agent to represent more than one buyer looking at the same property. But what if two buyers you represent both want to make offers to purchase the same property at the same time? How do you handle this situation without violating your agency duties to each of those buyers?

HB 532, which became law on April 6, provides a protocol to be followed by licensees when handling “contemporaneous offers.” Contemporaneous offers is defined as offers to purchase or lease made by two or more clients represented by the same licensee for the same property that the licensee knows or has reason to know will be taken under consideration by the owner during the same period of time.

Below are FAQs that outline the new license law requirements for handling this situation.

Q. I wrote an offer for one buyer client that is still open for acceptance. Now a second buyer I represent has decided that she wants to make an offer on the same property. How do I handle this situation?

A. Because these offers will be considered at the same time, HB 532 requires you to provide written disclosure to the buyers of the fact that you represent another buyer who is also making an offer to purchase the same property.

Q. When do I have to make this disclosure?

A. HB 532 provides that the disclosure must be made before writing the second offer.

Q. Can the written notice be accomplished by text or email?

A. Yes. Be sure to document this by printing a copy of your email or taking a screen shot of your text.

Q. Can you suggest sample language that can be used to make this disclosure?

A. Yes, OAR has created sample language that can be used — Notice of Contemporaneous Offers.

Q. What if my buyer doesn’t text or email, making timely written notification difficult? Can verbal notice be made?

A. Yes. HB 532 provides that if written notice can’t be made in a timely manner, verbal notification can be made. Of course you should document that you provided this verbal notification.

Q. Do I need the consent of the first buyer before I can write the second offer?

A. No. HB 532 only requires that you disclose the contemporaneous offer situation.

Q. What happens if one of the buyers isn’t comfortable with me writing an offer for another buyer?

A. HB 532 requires that if requested, you must make a referral to another licensee. That referral could be to another agent in your brokerage, or if the buyer is not comfortable with that, to a licensee in another brokerage.

Q. What happens if I tell buyer #2 that I have already written an offer for buyer #1 and she immediately requests that I refer her to another agent, which I do. Since I no longer represent buyer #2, do I still have to notify buyer #1?

A. No. According to the Division, if buyer #2 immediately decides to work with another licensee and you will not be representing buyer #2 or writing the offer for her, a contemporaneous offer situation no longer exists and no disclosure to buyer #1 is required.

Q. If I make a referral to another licensee, can I be paid a referral fee from that licensee? If so, do I have to disclose that to the buyer?

A. There is nothing in HB 532 or the current law that would prohibit such a referral fee or mandate disclosure of that referral fee.

Q. I have shown two buyers the same house, but only one of those buyers has decided to make an offer at this point. Do I have to notify the other buyer of this fact?

A. No. If only one buyer makes an offer, a “contemporaneous offer” situation does not exist and no disclosure to the other buyer you represent can be made. Remember, the disclosure provisions only apply if two or more offers made by your clients will be considered at the same time.

Q. I wrote an offer to purchase for my buyer client that was accepted by the seller. A week later another buyer client contacted me to write a backup offer on the same property. Do I have to notify the buyers?

A. No. In this situation there aren’t two open offers pending at the same time; instead there is a pending contract and a backup offer. Because the disclosure is only required when there are two offers pending at the same time, no notice is required before you write the back-up offer.

Q. What about my duty of confidentiality to my clients? By disclosing that there are contemporaneous offers, aren’t I violating my duty of confidentiality to my clients?

A. Generally, you are correct that an agent’s duty of confidentiality could be breached by disclosing to others that a client has made an offer to purchase a property. HB 532 creates a narrow exception to this general duty by only permitting disclosure when there are two offers on the same property from two buyer clients that will be considered at the same time. HB 532 specifically states that disclosure of the existence of contemporaneous offers does not breach the licensee’s duty of confidentiality.

Q. What about the identity of the buyers and the terms of their offers? Can that be disclosed?

A. No. HB 532 specifically provides that the identities of the buyer and the terms of their offers is prohibited.

Q. What if I am the listing agent on the property that the buyers want to make an offer on? Don’t I need the consent of the seller to disclose the existence of multiple offers to the buyers?

A. You are absolutely correct. Your duty of confidentiality to your seller normally requires that you obtain the consent of the seller to disclose that a multiple offer situation exists. However, HB 532 again provides a safe harbor by providing that disclosure of the contemporaneous offers does not breach the licensee’s duty of confidentiality to any party. This would include the seller. Therefore, the consent of the seller is not required in this limited situation.

Q. As a broker, I am not comfortable with one of my agents writing offers for more than one buyer on the same property at the same time. Can I adopt a policy that if that situation arises one of the buyers must be referred to a manager or another agent in our brokerage?

A. Yes. A broker can adopt a policy of this nature.

Q. I am a member of a team. If I write an offer for one buyer and another member of my team writes an offer for a buyer she represents, do we have to follow the disclosure requirements?

A. No. The contemporaneous offer disclosure is only required when one agent writes both offers.

Q. Does HB 532 require that information on contemporaneous offers be included in the Consumer Guide to Agency Relationships?

A. No, this is not required by HB 532. However it is advisable to provide an explanation of how contemporaneous offers will be handled early in a relationship with a buyer to avoid confusion and reduce the likelihood that a buyer will react negatively to this situation. This could be accomplished in the Consumer Guide or in a separate document. A sample explanation has been developed by OAR — Contemporaneous Offer Disclosure Policy

Q. Do the contemporaneous offer provisions apply to leases?

A. Yes.

Q. Do these license law provisions regarding contemporaneous offers also apply to commercial real estate?

A. Yes.


Legal articles provided in the OAR Daily Buzz are intended to provide broad, general information about the law and is not intended to be legal advice. Before applying this information to a specific legal problem, readers are urged to seek advice from an attorney. 

Tags: legal