several times lately, I have received several offers that didn't pan out. When I asked the other Realtor how they arrived at their offer figure, they said that the buyer came up with that number. Well, in my experience, there are two scenarios that always show themselves:
1) the price that the buyer wants to pay, or the seller needs to get are both irrelevant. Market value is the only thing that matters. Yes, there are circumstances that will adjust that figure, divorce,financial problems, death, property condition, etc., but by and large, market value is the determiner.
2) when the buyer makes an offer that is extremely low, they never get a good response from the seller. They are going to counter high, as they perceive the buyer as not being serious.
the point is that the buyer and seller are not in a position to determine market value without the advice of their Realtor. You would not tell your Doctor what to prescribe for a particular illness. You would not tell your C.P.A. How to do your taxes. You would not tell your Dentist the proper way to deal with a tooth problem.
At at the same time, the Realtor needs to take control. Now, it is true that we are required to present any offer, but there are constructive ways to handle it. "Mr. Buyer, if you want to buy this home, we need to be in this price range, as we will get a better response. If not, perhaps we need to be looking at homes in a lower price range". Put yourself in the seller's position: he has a home that is in an active area, a good lot and floor plan. Why would he look at a low price when comparable homes around it have sold for much more. " now, Mr. Buyer, there are neighborhoods around that are much slower to move and not as desirable. Because of the market, we can get you a home at the dollar range that you want to pay. " but I don't like that area as well", says Mr. Buyer. " Well, you like this neighborhood more. Obviously, other people do, as evidenced by the market, so let's make an offer closer to market value, ok?"
My last point is another trueism. Any home that needs $20,000 in updates will cause the buyer to figure $100,000 in updates in his offer. Mr. Seller, if you have light fixtures from the '70s, it will cost you a few hundred dollars to change them out, before the home goes on the market. It's money well spent.
Once again, thanks for reading my rants. Steve Houck