Ralph Gorgoglione wrote a great blog this morning Low-Ball offers: How do YOU handle them? and it got me thinking. We have all worked with buyers who want to "simply throw out a low-ball offer" and then see what happens. If this is a property they do not care much about, or if it's something that might work...if you can get it for a very low price...then that might make sense. But if this is a home you are serious about, I always advise against this tactic.
We all love a deal....a sale, a discount, a coupon. Of course we do! But when writing an offer on a home, you might be doing yourself a great disservice by low-balling....especially if it's just a first "throw out" and you are willing to come up higher. I hear things from buyers like "I just want to try" or "let's just see what they come back with." But a quick read just on Active Rain shows that the industry has an ongoing debate about whether they should advise the sellers to even respond at all. If the offer is extremely low, I normally council my sellers to counter with the full list price.
The problem for the buyers is a lowball offer diminishes them in the eyes of the seller and that sets the stage for the entire process. As a listing agent, I need to tell the seller that they have an offer, even when I tell them it's very low, they do get excited. I never let them stew....I give it to them over the phone, but it's always met with first with disappointment and then with annoyance. The problem is that the annoyance is what sticks with them. They are insulted!!! This is not the way you want to start a negotiation on a home you actually want. I find this often backfires on the buyer. Generally:
1) The sellers do not counter/settle for as low a sales price as they might otherwise because they are annoyed and feel the buyer is trying to take advantage of them.
2) The sellers often dig in their heels when it comes to concessions and repair requests....again, they tend to feel the buyers are "users."
I always recommend that a serious buyer avoid the temptation to low-ball on a home they want....it might end up costing them more in the end.
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|HÔM SOTHEBY'S INTERNATIONAL REALTY
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