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What is a good offer

When i started in this business way back in the stone age of 2001, when we put a offer together we looked at all the information out there, ran MLS comps, Tax comps, looked at active for comparable and then put a reasonable offer together.

we then called the agent on teh other side to discuss the offer and then submitted it, recently what i have been seeing is that someone looks at the price and offers $50K less and then if you talk to them they will tell you that the market is collapsing and that is what the buyer wanted to offer, why waste everybody's time, where did we stop being professionals, we are agents of our clients not just a order taker.

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Posted by Andrew Monaghan CRS, GRI, EPro Associate Broker on 12/26/2007 01:04 AM

Comments (16)

arizona, low offers

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16 Comments on What is a good offer

DEC

2007

Lowballers abound. they are part of this market when everyone knows someone somewhere who is in trouble. I do not take the offers personally, i just forward them for rejection. I have even countered with "if that offer gets accepted, I'll beat it myself."

I find that most offers come in low. Just have the seller counter at what they think is reasonable and what they are willing to take. You'll find that buyers will accept the counter. They just like to play the game.

The buyer may accept or not, this depends on what type of buyers they are. I work with an investor, and he goes by the numbers, and sets the price, goes with multiple offers, and either gets his price or moves to another property. I am not even consult him any more, do what he says. I was getting angry at first and was arguing with him, but after 2 times people have accepted his price and slavery terms, I do not have the authority to tell him that this is low.

Another type of buyers are people, who just do not want to pay a penny more than they absolutely have to. And in this market when they hear all these horror stories, and hear about falling prices, they are simply checking the market. You may tell them whatever you think, but when they send a low-ball offer on the property they like, and get a counter, they are happy and they buy.

ANd, of course, this is not about us, so we need to leave our ambitions behind the door.

Even in our market in British Columbia there are some buyers that want to low ball so far out of the market comps because they believe that the sellers have to sell. 99.9% of the time it does not work.

I do work for my buyers. We did a low ball offer just recently, we held our ground and the owner took it. My clients were looking at the price now and in their mind, the market will continue to drop, so they wanted to offer low. My job was to present the offer, convience the listing agent why so, not give up and go for it.

It worked for my clients and if the market stays the same, they made a great purchase, if not, they are not too far off, and I can sleep better at night. I make sure they are fine if the seller does not accept their low offer and they might lose the house.

Sylvia

I received an offer for $200,000 less than asking and the agent had the nerve to give me a lecture on how bad the market was. Apparently the rest of us did not get the message. Properties were still moving and during that period of time we had the highest price growth in the nation.

I have received some low ball offers on my foreclosure listings and the bank that I deal with prefers to counter than reject. They may counter back at original price. Much of the time it's to hold a buyer instead of losing them altogether.

I think that sometimes presentation is the key. I find many lowball offers to be incomplete and with errors.

It will all come to an end and we will be back to a traditional market at sometime and we will talk about the trials we had to go through in 2007. We need to adjust to the market and keep going forward.

Andrew, I agree in a strong buyers market more lowballers will abound. You just present the offer to the seller as an offer and leave it at that. Some people are trying to steal houses, but they will find out in most cases it doesn't work.

I've had and heard of more buyers just walking away after that initial low offer.

http://activerain.com/blogsview/179447/-Round-Robin-Buying

Don't get upset because another potential sale fell thru; the low-baller is the only game in town for some neighborhoods, and it works. Eventually, maybe not for you, but it works. Next week, that'll be the new comp, a few more of those and your seller has to match the new prices because nothing else will appraise at their original price.

I'd add to Frank's pre-bust blog that 5-10 houses should be in the mix, and $25k off is no longer an aggressive offer.

You may roll your eyes at the thought of 10 contracts for one buyer, but there are plenty of hungry agents wanting to work with someone who has cash and can close the sale. I'm sure that for the buyers the three weeks and ten contracts would be worth $50k off.

DEC

2007

Randy,

I have seen $290K lower offer and it was accepted. Why be so nervous?

buyers are probing for what the seller will take.

that's fine i guess.

so counter reasonably and inform the seller that at least there is activity on the home.

DEC

2007

Andrew

To see that you started in 2001 and you have established yourself as you have it gives me hope. This is truely my first year and what a year to start in this business and I note you are looking for more people to join you. Well done.

Thanks

Nathan Holman

JAN

I was reviewing some old posts and in looking at this one it was true in Dec 2007 and it still is appropriate today.

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