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What do you do with the ridiculous bidder?

By
Real Estate Agent with Realty Associates

What do you do with the ridiculous bidder?

 

 

 

Luxury Home Windsor Bay Woodfield Country ClubRecently, we had a buyer arrive in Florida from a significant distance away. The buyer was here to purchase a home which was to be a second home for winter usage.

 

 

 

Delray Beach Homes and CondosThis buyer had been receiving listings as requested in a certain price range. For discussion sake, let's say that price range was $800,000 to $1,000,000. Amongst the criteria was that the property had to need no work, be either new or completely renovated, have a pool, add in a dock, and of course the best view around.

 

 

 

 

 

Palmetto Place CondosDespite the headlines we all read every day, one is unable to buy a home directly on the ocean or the intracoastal fitting that description. If it existed, I suspect that rather then reading this, you would be sipping Margaritas after you walked on your private beach or docked your yacht behind your mansion.

 

 

 

 

Aragon Luxury Ocean Front Condos Boca RatonSo. The buyer is informed verbally and with appropriate MLS comps that a single family home does not exist at that price range in the location desired.

 

 

 

 

 

The Excelsior Luxury Ocean Front CondoThus, we set out to find a condominium. There is inventory in that price range with great views, newer construction, excellent building amenities, etc. etc.

 

 

 

 

200 East CondosThe buyer decides on the lovely unit which let's say was listed at $900,000. The condo has been well priced by the agent for quick sale. Comps in the building show that in the last six months eight condos sold with the selling price of eight of them being actually over $900,000. One sold for under $800,000 but was on the lowest floor and had no view, unless you consider parking lots your thing.

 

 

 

 

 

Long Lake Estate HomeOK. The buyer now says, put in a bid and via email says "Draw up a contract at $550,000". When the potential buyer is called, the buyer states that condos go for much less then that. No degree of reasoning would penetrate that logic.

 

 

 

 

 

The question. Do you put the bid in? Do you walk away from the potential buyer? Do you put the bid in and hope that the buyer becomes flexible? Do you hope the seller wants to participate in a give away?  Do you put your cell phone on ignore from the buyer's phone number?

 


Posted by

Erv Fleishman

Realty Associates

561 654 6116

561 988 9525 fax

Comments (8)

Bruce Parker
Best Realty - Highland Park, NJ
You Deserve The Best

I had a home on the market for $300,000 a pain in the butt buyer put in an offer for $120,000. His agent called 10 times asking for a counter. He also demanded one in writing.

My seller sent him a written and notaried counter offer for $9,000,000. I loved it!

Jul 02, 2011 07:11 AM
Deborah Byron Leffler BzyBee Real Estate Lady!
Keller Williams Realty Boise - Nampa, ID

That is such a hard one....in a lot of ways you are wasting your time....but I have seen around here that some times ridiculous bids are accepted....I would write it with a lot of counseling....and maybe that will help them to be more realistic nex time...

A lot will cut them loose...and I don't think anything is wrong with that either....

Good Luck!

Jul 02, 2011 07:11 AM
Eric Crane -- Your Full Service, Discount Fee Realtor®
DPR Realty LLC - Gilbert, AZ
Greater Metro Phoenix Arizona

Hi, Erv.  Since I work in Arizona, I sometimes have a very similar conversation with out-of-state or out-of-country clients who are looking for a deal.  here is the approach I use...

1st, I would try the same strategy you have used -- to show them the documented comps.


2nd, I tell them this... when the market was breaking down in 2007 and 2008, there were often wide gaps between the list price and the sale price, because the market was in retreat and Buyers and Sellers were trying to discover what a realistic value was.  But now the market is down 50% or more, and over the course of the past year, the market has stabilized.  Buyers and sellers are now in much closer agreement as to current value and most properties are selling for prices very close to list price.  Sellers no longer feel the need to accept a low-ball offer. (again, refer to documented comps).

This will often do the trick.  If it is still a no-go, I try the following:
Mr. Buyer, let's put ourselves in the shoes of the Seller for a moment.  Let's say that YOU are the owner of this property and YOU are trying to sell it.  You have it listed for 900K and there have been eight recent sales in the price area.  So you know it is priced right.  But you don't yet have it under contract.  A potential Buyer comes to you and offers 550 -- do you accept it, counter offer or reject it?

I wait.  They usually are silent for a moment.  Then I say.... What you would be thinking is, "Man, there is a lot of 'air' between 900K and 550K.  If I want to get aggressive, I could gradually lower the price and see if the traffic accelerates an offer emerges.  So I don't need to sell it for 550K.  I can first lower it to 875, 850, 800, 750, etc. 

So, Mr. Buyer -- you would not look at the offer at 550K seriously, and neither will this Seller.  We have to make a realistic offer or we have to find a property that you can realistically spend 550K on.  What would you prefer?

At that point, it is all very simple -- I either have a realistic Buyer or I have a client to fire.

Have a great 4th!

Jul 02, 2011 07:22 AM
Bill Pohl
Tetra Homes, Inc. - Loveland, OH

I'd put the bid in because you never know what the seller's financial position is at the moment. The seller could take $550,000 as a needed sale. Don't pre-judge and place your own criteria on the transaction. (Please don't take offense to this>>>>) You are an agent, not the principal and are there to deliver the contract. Just that simple.

Jul 02, 2011 04:03 PM
Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

I've got a Buyer that wants to offer $200K Cash on a $571K Listing.

  Florida Law requires me to present "All Reasonable Offers", unless the Seller has given written instructions otherwise.

  So I'm gonna present it. 

  The Seller owns the Property free and clear... so who knows, they might accept it.

Jul 02, 2011 05:42 PM
Laura S. Baker
First Weber Inc - Lake Mills, WI
Realtor (920) 728-4118, First Weber Inc

"If it existed, I suspect that rather then reading this, you would be sipping Margaritas after you walked on your private beach or docked your yacht behind your mansion."  Can't answer, I'm making my Margarita & looking for this place yet!

Aug 26, 2011 03:26 AM
Sherry Peckhoon Sim
Sims & Company - Cayucos, CA
Broker/Owner, Covering the Beautiful Central Coast

I had a similar situation where the seller is extremely insulted, especially to be asked to initial the rejection section (we have this in the CA residential purchase contract), and my seller refused even to acknowledge the offer.  I say it's a tough call, and do you wish to be known as the agent representing "ridiculous" offers as my seller calls them? 

Sep 06, 2011 08:46 PM
Irene Durocher
Coldwell Banker BUYERS AGENT - Boca Raton, FL
homesweethome4u@att.net

Several years ago I had a buyer that was interested in a commercial property ,it had great potenial.

The buyer really wanted the property, she offered $ 50,000 less than asking price which was already

low. The seller counter offered at $ 100,000 more than the listed price .  She was insulted, but got the 

message.



Irene Durocher Bristol Properties

Boca Raton,Fla.



Nov 13, 2011 06:10 AM