Q: Can a seller increase the asking price after I make a formal offer?

A: Yes. An agreement to purchase and sell real estate is a contract that requires offer and acceptance to be valid. The seller and purchaser must have a meeting of the minds on the material terms of the transaction, and some valuable consideration (earnest money) must be exchanged to make the agreement binding. Any real estate agreement must also be in writing, as Georgia law requires. Typically, in the real estate context, a binding agreement arises once both parties have signed a contract setting out the material terms of the purchase and sale, and the purchaser has given earnest money to be held in an escrow account by the seller.

Until all material terms in an agreement have been agreed to — including, but not limited to, the purchase price — the back and forth between purchaser and seller are merely offers and counteroffers. The seller may change the asking price at any time prior to entering into a binding agreement. Only when one party accepts all the material terms of an offer or counteroffer from the other party will an agreement arise between the parties. When negotiating an offer and sale of real estate, you should always consider seeking legal advice to protect your interests during negotiations and/or to review the final purchase and sale agreement.

This column is designed to provide information in regard to the subject matter covered. It is not intended to render legal advice.

— By Raghu R. Raju, an attorney of Weinstock & Scavo, P.C.; rraju@wslaw.net; www.wslaw.com.

Have a question you would like answered in this column? Please contact James J. Scavo at jscavo@wslaw.net or c/o Weinstock & Scavo, P.C., 3405 Piedmont Road, Suite 300, Atlanta, GA 30305.