You may have seen me deal with multiple offers on Million Dollar Listing LA, walking out of a dinner, standing on the sidewalk and shouting into my cell phone while I have the other agent on hold. For me and every real estate agent I know, bidding wars are a rush, a high. I live for them. You should, too. Learn ’em. Lure ’em. Love ’em. Leverage the hell out of ’em and close.

Now I’m going to break down multiples and bidding wars from the seller’s point of view. Buyers should just flip the advice and, in a seller’s market, they will have new insight into how to hit a seller’s hot buttons, get ’em squirming, and win the house.

Getting new bids almost always involves more cash, less time, and some crazy terms. The highest bid, preferably all cash, with the shortest closing schedule is usually the winning offer. Usually. For the buyer, however, leverage lies in the contingencies. If the house doesn’t pass an inspection, say, the leaky roof is deducted from the price – that is, if you still want the house. If the appraisal deems the house is worth lower than its list price, that’s more leverage to lower the offer. If the buyers need financing, the lenders won’t approve it for an overvalued house. The process of selling real estate – more open, work, close – has built-in trip wires so buyers and their lenders don’t buy defective houses unaware. Be aware of this or these landmines will blow up in your face

For buyers, counteroffers mean you are in the fight. It’s a good thing and one you must power through to win a house in a tight market. Don’t stand down. If you love a house, make an offer because you just never know. If you aren’t an all-cash player, sweeten the deal. Go back to the previous two chapters and see what you can work into your offer and counters. Know your boundaries. How high will you go? Stand firm. Fight. Have a walk-away number. This is important. Many get lost in the passionate back and forth of war. There blood gets pumping in the heat of battle and they overpay for a property.

No matter which side of the table you’re on, buyer or seller, remember, you are a team. The goal in any negotiation is not winner take all. It’s creating agreement that benefits two or more parties. You discuss every move with the client and build strategy together. You are their heart and their head; you know their needs and their intentions. Your client’s money is your money. If they’re happy in victory, you’re happy in victory.

Listen up, some real estate agents watch offers float by, acting on the one the seller likes. These agents will never work for me. Why would you do all the work to get to the negotiation and not work the most exciting part of the process – the close? Your job is to get the best price and terms for your client. That’s it. That’s the goal. Play the offers. Work the deal.

Negotiating on the Clock

To master working multiples is to truly own the shot clock. Once it’s set, it’s yours. Play it. Hit the buzzer beater. You’ve got 72 hours. Maybe 24. Maybe two. Love that clock. Manipulate the hell out of it. Which deal do you want to keep active and which do you want to reject? Are you watching your top offer in every round? Are you expecting more offers? Who else can you call?

Multiples require great organizational and analytical skills that turn on a dime. Don’t shy away from it. It’s why I suggested you practice negotiation on the smaller deals. It builds confidence and develops negotiation as habit. Negotiation must be your breath, the reason your heart beats, the blood in your veins. You can approach multiples any way you like, but there are standard identifiable moves when you have more than one offer in front of you. I like #2. It’s why my clients keep coming back. It’s why I make money. Big money.

1. Just accept whatever offer the seller likes best.
2. Issue counteroffers to one or more buyer.
3. Ask all buyers to resubmit “best and highest” bids.
4. Adjust the price and look for more offers.

Different circumstances call for different moves; but #2 is your go-to, the one most likely to set up a real bidding war. Remember, always be respectful. It’s not just a general rule of life and Game-Time mentality, but it’s good business because you don’t know which, if any, of these potential buyers you’ll have to go back to.

No deal is ever the same and no deal is ever easy, even a “small” one. I would also make the argument that there are no small real estate deals; every one impacts someone’s life. In a seller’s market where multiples are standard, it is my experience they tend to move like this:

• 1st offer: It’s often lower than list since the buyer has no idea if anyone is interested in the house besides them.
• 2nd offer: This one tends to come in closer to asking.
• 3rd offer: This is usually a strong offer, at ask or over list, because the buyer really wants the property.

Every offer is under the clock and will expire. The same is true of every counteroffer. You must keep track of it all, opening, working, and closing each offer as you work with the client to reject it or move it forward in the rounds. Every time a new offer is written up and submitted, the terms must be examined quickly and understood.

During multiples, real estate time gets vicious. It’s killer. The clock ticks, the weapons drawn and fired. If you were stressed getting your house launched, this phase will test your might. In all 50 states, there’s no law that says a seller has to respond to a real estate offer. It can just sit there to signal a seller’s rejection. If you’re trying to buy the house, you have to submit and then counter, and maybe even counter again, to get the seller’s attention. To get into the game, a potential buyer might break the silence with a higher bid or larger EMD money. So pay attention.

I was working on a sale in the Pacific Palisades, a rare one-acre double lot that backed up to the Riviera Golf Course. If you can manage to get into the Riviera, it’s a $350,000 initiation fee to golf with the likes of Adam Sandler and Larry David. The landscaping around this house was wild. I’m talking Amazon forest wild with a large pool and waterfall. The owner’s rep had me come to the property and told me they wanted to list it at $9.5 million. “That’s too low,” I said, “I can sell it for $12 million.” He took me up on my offer. “If you’re so confident, I’ll give you 30 days to bring me an offer at that price. Otherwise, you lose the listing.”

After a handful of showings, it was apparent the house would not sell to buyers as is. The house had never been renovated. It was a tear-down. I had to get to my BANTA pretty damn fast if I was to meet the deadline. I had to pivot and reset my strategy in an afternoon. As the great fighter Mike Tyson said, “Everybody’s got a plan until you get punched in the face.”

I decided on a builders’ auction. I invited them in, set up the forms, and took offers. I was completely pumped about what I saw. I had a solid $10 million offer come in. During the event a builder called me. He had just heard about the house and wanted in, but was out of town. I said, “Bro, I have so many offers in hand, a week from now won’t cut it. The house will already be sold by then.” And I hung up.

Later, I met with the seller’s rep. I should have guessed his mood when he said, “I can’t imagine how you got me to drive from Beverly Hills to the Palisades on a Friday.” I tried to loosen him up a bit. “Are those shoes comfortable without any socks?” “Yes, my shoes are fine, Josh. Where are the offers?” He was all business. I presented what I had, certain he’d be pleased: one of the offers was over what they originally wanted to set the ask price at. He was not pleased. “Josh, you told me you could get more. Therefore I told my client, you would get $12 million, and $10.4 million is not $12 million. You know, Josh, you haven’t done what you’ve said you were going to do and now I have to fire you from this listing.”

I remember going cold so I’m sure the color drained from my face. I couldn’t believe it. “Starting at $12 I assumed $10 would be the settling number and I got more than that with $10.4 million.” “If that was the thinking,” he said, “then $11 million would be the number. Come on, Josh, we know this game. My client might go for that, but $10.4 million is not our agreement. You said you could do $12 million in 30 days.”

I had one last play and it was a 1,000 to 1 shot. “I had one builder call during the showing. He was out of town and couldn’t bid sight unseen, but I told him we couldn’t wait. Let me give him a call.” I got him on the phone and told him, “We’ve gone to best and final. $11.2 will get it for you but I have to have an offer in writing in the next hour.”

A few beats passed and I received the text message. The seller’s rep and I had an offer from the guy for $11.2 million and we closed the deal. I was ecstatic, jumped into the pool in my suit, the really expensive one made of the finest threads in all of Italy. Closing-wise, this was a close call. The shot clock can be a bitch. The sweetest part about that deal is I caught it all on camera on Million Dollar Listing LA.

No Rules? Use Hammers for Leverage

Multiple offers and bidding wars are the Wild West; the rules are no rules.

Now, as I’m working the phone issuing counteroffers, I might say something like “tell your client if he can afford X, he can afford Y.” I go back through my notes on potential buyers and look for hammers. I call the two with tight timelines first; both have kids starting school in August. “This house is going,” I tell the other agent. “If your client is going to offer, I will need X by Y,” and I start adding more players to the bidding. I might find notes on a buyer’s reaction, call the agent and say, do you remember your client who toured 408 Thrasher? She melted over that view and kitchen; it was perfect for her family, she said. I have offers and I want to give you and your client a heads up. I want you guys to have a shot at that great house.” You keep stoking the fires of FOMO, exclusivity, and time, nudging all parties toward war.

Once multiples arrive – even if it’s two – know your exact response time. Know the shot clock and the play, when you need to deliver. As more come in, you need to analyze quickly and decide if any of them is the one. It’s all about price and terms.

Evaluate the price in relationship to the terms. How much higher or lower is it than list? How do the offers fall in line against each other, lowest to highest? Does the highest have the best terms? Or does another offer have those? What is more important to the seller? What does your seller need most? Cash?

Do they need out of the house immediately or in two months? Are they trying to buy another house? Have they submitted a strong financial picture to the seller along with their offer? Great credit and a job still matter in America. Do they want contingencies? Appraisals? Inspections? Are there caveats attached?

Setting a cut-off day and time for offers isn’t always necessary, but helps to keep things moving. It can be nudged and even ignored in a lot of cases so not to lose potential bidders, but set the clock to play the clock. In a high-end market, powerful people make power moves. Their pride and reputation depend on it. They can and they will pull rank. Still, sellers will most often choose the most attractive offer no matter when it’s made, so if you lose a house as a buyer, ranting and raving about rule breakers will do you no good. There’s no loyalty, remember?

I had a penthouse in Downtown LA. It was $4 million. We got a ton of offers. We countered a ton of offers. We went back and forth for days. Right as I was about to accept one of them, another offer came in out of the blue with a higher price and better terms and stole the property away from everyone else. So after all that work, here came the dark horse that robbed the whole lot.

Bidding wars can continue as long as the seller wants to keep going and buyers are still submitting offers and counters. As you open, work, and close each offer, use any one of these ten hammers for leverage:

1. Time: Hook the shot clock to everything you do to nudge deals forward. Some of it is already wired into real estate transactions by law, but in real estate, speed matters. You can jump over time to show enthusiasm or wait until the last second and knock out other offers. Think strategy.
2. Boundaries or parameters: If you’re the seller, a boundary might look like “no offer below X.” If you’re the buyer, it might be “start at X but do not go beyond Y.” In the speed of multiples, you move within these walls and, if you’re the seller, you nudge them upward while sweetening any terms you can. The buyer, once their financial threshold is reached, needs to have a plan with contingencies to sweeten the deal.
3. Your playbook: The playbook, or “the narrative,” is your reasoning for the values you’ve set on the property and the deal. Don’t get swayed from what you want by other people’s play calls. If you aren’t completely clear about what you want, what you need, and what you will accept, people will attempt to get you to agree to their narrative. Don’t. If you’ve pitched this house as the last four bedrooms in the most family-friendly neighborhood in town, you are still selling that value.
4. Token concession: At the beginning, I always make a goodwill concession on a point I don’t care about. It sets a mood. Give to get. I usually come up with the concession during the work phase when I’m listening for hammers to exploit. Because we know energy begets energy and close begets close, if you start the ball rolling with great energy, it might set a tone for better, more engaged, and open negotiation.
5. The win-win: The cliché “win-win” is classic negotiation-speak for “You get what you want, I get what I want.” Call it integrative bargaining. For the win-win to work, you need to visualize and pitch how it benefits everybody. Nudge all parties toward agreement. “We’re looking for something between X and Y” is an easy way to push/pull an interested party into your line of thinking.
6. BANTA or Plan B: For the buyer, it’s always another house. For the seller, it’s another buyer. Keep your eye on what you need should the deal fall through. (The playbook, #3 above, is the reason you keep such fine notes; if you have to go back to the beginning, it’s a lot easier if you can reconstruct what has already happened and pick it up from there.)

7. Power: Everything from what you wear to what you say should speak power. Dress power. Select your words and strategize power. Use silence to get others talking, because information is power. If you’re an experienced, well-known agent dealing with a young, newer-to-the-market client, that’s the power of experience.

   The most powerful tool of all – so powerful it gets its own chapter at the end of this book – is the walk-away. Project to your counterparts that you don’t have to do this deal; let them worry you’ll bounce. That’s true power and success. A great example of power is on the reality show Shark Tank. The row of investors sits mute while entrepreneurs dance in front of them as fast as they can. It’s set up like that to show who has the power.
8. The over-ask: Go in asking for more than you expect to get. You never know, you just might get it. It also allows you the power of saying what it’s worth, and buyers will feel like they got a steal when you say “yes” to their price. Usually though, your counterpart will push for a lower price and you’ll end up at your expectations. Say the buyer wants the furniture. Your client puts the number $20,000 on it, so you ask for $30,000.
9. Friction: Two forces moving against each other create friction. That’s you and the other side of the table. Disagreement is the foundation of democracy, free markets, and most marriages. It’s a good thing. Don’t shy from it.
10. Knowledge: I can honestly say agents miss points in the offers I submit at least 50% of the time. They’re just so focused on a final number. Terms matter. It’s why I told you to build endurance and game-time mentality. Don’t lose focus here because the war is almost won. Read everything, even the fine print, on every offer, and then read it again. It’s what you miss that’ll kill you.

As you issue counters, work with your client on them, keeping expectations as even as possible. As you go over your attack plan, strategize where you want to take the sale. I have some clients who are willing to push all players to higher numbers, thereby accepting the risk of driving some away. Others hit a certain number, get pumped, and call it a day. Here are the six most useful hammers while negotiating counters.

1. When you issue counteroffers, you’ll have a big hammer with urgency. Everything already has a legal shot clock attached (72 hours).
2. Your boundaries and parameters lie in front of you – the lowest to highest offers, as well as the number you hope to achieve. How do you move from one number to a higher number?
3. The over-ask might work for you; counter higher to get to the price you want. The over-ask is based on the belief that the buyer wants the house and will counter your counter somewhere in the middle.
4. You can approach an offer with the win-win strategy, pulling a particular buyer to the head of the pack and closing the deal. You can attempt to nudge any buyer higher with the win-win.
5. Never shy from friction and disagreement. It’s the bedrock of free markets and democracy. We work our own side of the fence, finding a point of commonality. As we know, that’s usually money. None of this is personal; if you don’t meet resistance, it’s an anomaly.
6. People just get too crazy around real estate. Money and pressure under time make people act weird. The more knowledge you have about all the players – your seller, the house, the neighborhood, the market, the buyer’s agents – the better to anticipate multiples and counters.

Learn these lists as if your career depends on it, because it does. You’re “Hollywood” now. Be “Hollywood.” Be a beast. Be a shark. Embed hammers in your brain so when the battle goes down you’ll be in the fight, counter after counter, no time to think, only to react. Know what to do and do it. Fold these moves into your style. Style, I love that word and everything about it. The Altman Brothers are “style.” I am “style.” You are now “style.” Let’s move on and talk style.