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A screenshot of a Weston house's listing on Final Offer. Image courtesy of Final Offer
When it launched an early version of its service in Greater Boston last spring, Final Offer was hoping to ride the seemingly never-ending wave of bidding wars for homes to transform the process of listing and selling a home.
One year, 155 basis points on the average 30-year mortgage’s interest rate and nearly 2,000 fewer Massachusetts home listings later, the Realtor-funded startup is back with a new version of its service that’s changed to reflect the market’s new reality and an ambition to prove its platform is ready for mass adoption.
The core concept is still the same, co-founder Tim Quirk said – bring transparency to the process of buying and selling a home – but Final Offer has been “radically improved and updated” with the goal of “driving urgency” in a home sale despite the overall lower level of activity in the market today.
Like its earlier iterations, sellers whose agents post their home’s listing on Final Offer still outline what their “final offer,” or ideal combination of price, concessions and other promises is. If a buyer can meet that right away, the seller has pre-committed to accept immediately, so long as it’s the highest and best offer that’s been made. But buyers and sellers now also have the ability to negotiate through the Final Offer platform, via their agents, and the software helps the seller’s agent organize and rank offers. If several buyers are able to meet the seller’s minimum offer terms, they and their agents are all notified so counter-offers can be made through the Final Offer platform before a shot clock runs out. Members of the public can also create accounts on the site to review properties’ offer histories, albeit with buyers’ identities redacted.
“If this was happening the traditional way, an agent would be on the phone for hours” notifying bidders’ agents, Quirk said.
Company’s Pitch to Agents
A Natick home recently sold through Final Offer illustrates the service’s potential, he said. The single-family home at 23 Farm Hill Road saw its winning bidder make a second offer $200,000 above its first, plus the waiver of inspection, appraisal and financing contingencies and a free 60-day leaseback provision after seeing what their competitors had offered, putting the home under agreement for $1.9 million on April 2.
Other multiple-offer situations documented in Boston-area listings on the platform saw much more modest jumps in offer value, but several display rapid-fire back-and-forth bidding wars that show offer prices rising and falling as contingencies and other offer details were added or removed.
“When people see value, they will come to the table,” Quirk said.
The company claims this level of transparency can cut out discrimination from the home-sales process.
“This is a non-discriminatory system. The only thing that matters is can you afford the property, and can you make an offer that the sellers will accept,” Quirk said.
Final Offer’s other big pitch to agents, Quirk said, is that every buyer and seller trying to buy or sell a home on Final Offer has signed contracts committing them to follow through on offers made or accepted. And all buyers must be pre-approved by a lender or offer proof of funds to make offers on the platform. And, once a winning offer is made, Final Offer’s software automatically sends the terms to the parties’ real estate attorneys to draft a formal purchase and sale agreement.
A screenshot of a Weston house’s listing on Final Offer, showing the range of terms its seller has pledged to accept. Image courtesy of Final Offer
Follows on Heels of D.C. Launch
Instead of its earlier business model driven by fees on buyers, the company plans to charge listing agents $200 per home posted to the platform, or a range of subscriptions whose price varies from $500 to $1,000 depending on length. The company’s long-term vision, Quirk said, is to attain sufficient market presence that it can offer real estate services companies alerts that a home has sold for a fee, or be able to sell agents and others data-driven insights into buyer and seller decision-making by analyzing anonymized data at market scales.
As of publication, Final Offer only had 24 Greater Boston listings on its platform, but has managed to draw around 250 listings onto its platform this year in its first launch market of Washington, D.C. While 250 homes represents a small fraction of the D.C.-area housing market, Quirk said the company has already secured significant brand awareness, and even had a brokerage buy subscriptions for all its 400 agents to use this spring.
“If you asked any real estate agent in Washington, D.C. what final offer was, they could tell you,” he said.
The company is hoping for similar success in Greater Boston and Cape Cod this year.
“The way we’re looking at it is looking to partner with agents that are heavy on the listings side while educating the community” about Final Offer, Quirk said. “Our strategy is to partner with agents who see this as a big value and differentiate themselves in the market.”
