The Psychology of the Low-Ball Offer in 2015

Jenna Dixon 

I suppose the rationale for making a low ball offers varies from buyer to buyer, but certainly doesn't send the message that a buyer would hopefully want...that is, I'm interested in your home, am qualified to buy it, have done my due diligence and would like to negotiate with you

Well done!

Jeff

So true!  As a listing agent who has received these types of offers I can attest to each of these as accurate.  I'd like to add that it also signals that they are both playing games and looking for a desperate seller.

Sometimes a low ball offer is warranted...if the home is overpriced! In that case, I always refer to the comps that justifies the lower price. However, I do agree that most listings are priced right and deserve a fair offer, esp if home is new to the market.

Hi Jenna - Your post is spot on.  The super bargains are few and far between now.  Prices have bumped up since the crash, and sellers are not as desperate to take any offer.

I have a client now that makes lowball offers and then if the seller agrees he then wants to renegotiate. Sometimes it works out, sometimes not.

Thanks Jenna. I think we have some folks who have not kept up with the market. They are still stuck back in the market crash days and think they can buy a mansion for Penny's on the dollar. Educating them can be a real challenge.

Jenna, this is a cleverly written post that tells it like it is!

Great post. Did you beat these thoughts out of buyers? lol. Sometimes it just gobsmacks me what buyers think when they make an offer. Case in point on my one listing - 30K below asking. Quote was:  You'll never know if you don't ask. Thanks but no thanks.

I am often asked what is the least amount a seller will accept or what should I offer; my response has remained the same, "You should offer what the home is worth to you, nothing more or less. If someone gets the home for $40 more, you have to be okay with that."

In my market where we still have asking prices in the $30ks and less.  All the offers are low offers.

www.409home.com

click on the bank owned properties to see what I mean

I am dealing with one now that thinks 50% of the asking price is a great place to start.  They don't even understand after looking at the comps that the home is already priced right.  Aaauuuggghhh!!!

This is such an awesome post, I had to reblog it!  I have worked with buyers who have embraced all of these points you mention, and guess what, they ended up not buying a house. 

I had a buyer this year and he always low balled, and after five offers I decided not to work wth him.

Dear Jenna,

2011 was the bottom of the market here. Some people have not noticed, that we have moved on to 2015 & almost 2016 now.

Hilarious and all true! I had a buyer like this earlier this year and needless to say they did not find a house to purchase and have since stopped looking. 

I came over from Shanna's reblog.  Great post Jenna, I am surprized it isn't featured.

I just wrote my last low ball offer ever!  They are demeaning, insulting and embarrassing. The Sellers don't jump respond to  them and the buyers loses in the long run, Pure waste of time,

Who even made up the term lowball offer?  What is that? 10% off? 20% off?  What gives Realtors the right to be so high and mighty that they say they will not write a lowball offer?  Have we forgotten that we represent the buyer when we write an offer?  It is not our money it is their money.  I have been on both the sending and receiving side of offers that I thought were too low.  So what.  Some of those deals went through and some of them did not.  Every deal is unique and every offer should be honored for what it is, an interest in the property that is for sale.  Paraphrasing Zig Zigglar: When a buy makes a low offer (s)he is saying I'm not willing to part with my big pile of money for the features and benefits that you have in your house.   (However I am willing to part with this smaller pile of money.)  Any offer, high or low, is voicing an interest in the property that is for sale.  That should be honored and respected. If the seller believes that they can get more they should wait.  It is that simple.  

We are not in control of the process we are advisers.  It is not our money and we do not have to live with consequences.  

If I do not have any other offers, I'll definitely suggest a seller to counter. At least, I'd try to discuss the situation with the agent and to see where their the very best terms.