The Pros and Cons of a real estate reverse offer

Here at NationalBLS we have been studying the reverse offer model for a long time and read pretty much every article out there on the web about the pros and cons of using a reverse offer.

One of the cons we hear a lot has to do with this assumption that a seller would have to be desperate to make an offer to a buyer I found this quote supporting that con.

“What the interested buyers hear coming from the listing agent is that the seller is either desperate, struggling, getting divorced, sick, in financial trouble or needs to sell and is willing to negotiate a real bargain of a deal.”

Just because a seller makes a reverse offer doesn’t necessarily mean that seller is desperate. Putting a For Sale sign in your yard could mean that you’re struggling, getting divorced, sick, in financial trouble and are willing to deal. The seller made the first move by listing their home for sale.

And don’t forget, selling a house is competitive. The chances are that if a buyer doesn’t buy your house, then they will buy someone else’s. Selling is a competitive sport but more importantly it is a contact sport. The chances of selling to someone you are not in contact with are zero. So let’s go from there.

Trying to sell your house without marketing it or telling people about it is as about effective as smiling in the dark. You might know you are doing it, but no one else does. Putting your house on the market indicates that you are for whatever reason “motivated to sell” but in today’s market there are literally millions of people “motivated to sell”.

A buyer will always try to find out why someone is motivated to sell in order to negotiate a great deal no matter what the price starts at or who starts the negotiation. The reverse offer does not say you are desperate, it simply say’s that you are “motivated” to get a deal done.

I have never heard of a buyer who has been upset to receive a reverse offer. Surprised perhaps and intrigued but not “less likely” to do a deal. My belief is that the “Stand and Sell” approach in today’s market is the worst thing a seller can do. Every day the property is on the market it depreciates in value and the longer it is on the market so does the negotiating ability of the seller. Sellers must get proactive if they want to get a deal done. Otherwise, take your home off the market.

Now more than ever sellers need to use an agent to go out and help them compete. Similarly, the sellers agent needs to get proactive and take advantage of every opportunity to find a buyer.