Hawaii Real Estate State Practice Exam

What effect does a counter-offer have on the original offer?

1. It is treated as an acceptance of the original offer

2. It voids the original offer

3. It requires immediate acceptance from the original offeror

4. It cannot be rejected by the original offeror

The correct answer is: It voids the original offer

A counter-offer fundamentally alters the dynamics of the negotiation process. When a counter-offer is presented, it functions as a rejection of the original offer rather than an acceptance. This means that the original offer is voided, and the terms proposed in the counter-offer become the new subject of discussion. The act of making a counter-offer signifies that the party is not satisfied with the terms of the original offer and is proposing different conditions that they would agree to. Therefore, the original offer is no longer on the table for consideration once a counter-offer is made. This principle is critical in real estate transactions, as it ensures that all parties are clear on what terms are being negotiated and prevents confusion over multiple conflicting offers. In this context, understanding the implications of a counter-offer is essential for anyone involved in real estate negotiations in Hawaii or elsewhere, as it can significantly impact the progress toward finalizing a deal.