Question

Seller is asking $300,000 for property and received an offe for $250,000. He countered for $280,000, but before the buyer was able to sign the counteroffer, seller received a full-price $300,000 offer; therefore he contacted the first buyer to revoke the counteroffer before it was accepted. Which of the following is true regarding this situation?

Answer 1

The seller in this real estate transaction legally revoked the counteroffer before acceptance, demonstrating key contract law principles such as counteroffers and revocations.

Step-by-step explanation:

The situation described involves the creation and revocation of a counteroffer in a real estate transaction. When the seller countered the buyer's offer of $250,000 with an offer of $280,000, they entered into a legal binding situation. However, the seller has the right to revoke the counteroffer at any time before it is accepted by the buyer. Since the seller received a full-price offer of $300,000, he was within his rights to contact the first buyer and revoke the $280,000 counteroffer before it was accepted, securing a more favorable deal for himself.

The principles demonstrated in this real estate scenario also reflect broader concepts related to offers and acceptances in contract law. Counteroffers can be viewed as a new offer, negating the original offer. Revocations are valid when communicated to the offeree before acceptance. This goes to show the importance of timely communications and responses in business transactions to ensure that parties secure the deals they consider most beneficial.