I'm sure everyone has gotten a low ball offer on one of their listings or has made a low ball offer. Sometimes the listing price is way off and the "low' offer may actually be in line with what the property is actually worth. If the seller is really motivated occasionally you get a reasonable counter. What bothers me is when an agent makes a truly ridiculous offer on a home that is priced fairly. I have a property listed at $229,000 with a value somewhere between $200,000 and 229,000. I got an offer for $95,750. This offer has no chance of being accepted or even countered and I relayed this to the agent. Her reply is that she is only doing what her client wants. He has a formula and this is how he buys. She "has" to make the offer because that is what her client wants. Really? If he wants you to make $10 offers on every home will you do that also? If he wants you to jump off the bridge will you do that? Personally I would not have submitted the offer. Why waste everyones time? What I want to know is where does it say she "has" to make the offer. I know we must present all offers to the seller. Where does it say we have to submit all offers from the buyer? I dont see that requirement anywhere.
I understand your thoughts on this and share in your sentiments. Its just a BIG waste of time!!
Kevin, its the agent's responsibility to educate their buyers what a low ball offer is and how it can affect their chance of actually getting the house. If its more than 20% below the value of the house, then it just might be a low ball offer.
Agree, it's a huge waste of time for all parties involved! Best Wishes to you in 2012!
I agree with Bernadine comment. Overall its a waste of time and the agent should probably not work with the clients.
How would you circumvent the fiduciary duties to your client? Jumping off a bridge is not within the scope of an agency agreement, but writing and submitting an offer as instructed by your client is.
When I started such I worked with such low-ballers. After a while I discovered they were not worth the trouble. Even if one deal in twenty was accepted.
I agree with Bernadine comment. Overall its a waste of time and the agent should probably not work with the clients.
Why do they think they "must" submit the offer? Where in the code of ethics or law does it say that?
Standard of Practice 1-6 " REALTORS shall submit offers and counter-offers objectively and as quickly as possible. "
I don't see where it states that this is only for for the Buyer or Seller.?
Also " objectively", who's to say it is low ball offer... only the parties to the transaction, is my response.
Finally, we are " independent contractors" if you don't want to work with a Buyer that submits repeatedly low offers, then don't. It is your choice who you work with.
Good point Mike. Here is the language from Fiduciary in Florida:
Obedience - "An agent is obligated to obey promptly and efficiently all lawful instructions of his principal."
So if he wants to offer $10 on $100,000 homes I have to do it or I am breaking fiduciary law?? There has to be something "reasonable" to the principals instructions. At some point you just tell him to find another agent and you no longer have any agency relationship.
I'm not a judge or an attorney, but I wouldn't want to have to pay an attorney to help me explain my decision that compliance with statute required a test for reasonableness, and my opinion should prevail.
As a matter of practicality, a frank discussion with the client who demands to submit unreasonable offers could lead to either more realistic offers, or to a mutual agreement to end the agency relationship.
Kevin - I don't know what the laws, rules or regs are in FL but here in CA, listing agents are required by law to present all offers unless the seller has specifically stated (in writing) what offers they do not wish you to submit. Personally, I don't know any sellers that have stated in writing which offers they do not want to see. I'm sure there are some, I just don't know them.
On another note, I know for a fact that there are a lot of Realtors here in CA that are in violation of this exact law (yes, this is a CA law and not some Realtor code). The fact that the CA DRE and HUD allow this practice to continue to happen with no repercussion to the violators is an atrocity.
Kevin - On another note, while I can certainly understand your frustration with lowballers, especially when you have done your job by pricing the property in accordance to current comps, this shouldn't stop you from doing your job - of presenting all offers to the seller. Let your seller have their right to reject the ridiculous offer. I suggest you get yourself a big rubber "Rejected" stamp and plaster it across the offer and send it back. I assure you, that's a pretty clear message to both the buyer and their agent.
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