Question for Agents About Handling a Low Ball Offer on a Listing

By
Real Estate Agent with Keller Williams DRE#: SA512872000

Hey agents, curious to get opinions about how you handle a low ball offer on a listing.

I have my opionion on how to best handle a low ball offer but would like to get feedback from other agents.

How would you handle a very low offer on a listing. The house is awesome and fairly priced. You know the buyer likes the home and wants to buy it but the offer was not even in the ballpark! We are talking $75k to $100K lower than the list price. 

What would you:

  1. Counter the offer
  2. Reject the offer with no counter
  3. Other please give feeback

What would you do? Please coment below. 

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Rainer
481,352
April Swenson
Coldwell Banker Ocean Shores Brokers - Ocean Shores, WA
CRS and Managing Broker - Ocean Shores Real Estate

If you are the Listing Broker and a buyer wants to write an Offer where it is so well below what is reasonable, I would respectfully refuse to write it and be honest that you represent the seller and would not suggest for them to take the offer.
If you do write an offer, always counter and have your sellers not get upset at the Offer, but treat it as a business deal and not personally.

May 15, 2016 04:05 PM #22
Rainmaker
509,170
Dan Tabit
Keller Williams Bellevue - Sammamish, WA

Hi Tyler, 

That far off, assuming I'm price right and we haven't been on the market for months, I'd call the agent and have a talk.  If they are just bottom fishing, that's one thing. If they have some compelling reason that I missed, I listen. 

Assuming that they are just out of line, my advice to my seller is not to respond. A low ball does not deserve a counter offer in my opinion.  I'd call the agent back after discussing with my seller and say, "Thank you for the offer, if this is the best you can do, we wish you well. We've elected not to counter since we are so far apart. If you can come somewhere close to where we have valued the property, we may reconsider."

In the mean time, I'd make sure other parties are aware there is an offer in play.  We don't need to disclose the details, but it often happens that something becomes more attractive to others, once someone else wants it. 

I've had this scenario and obtained a much better offer for my sellers following this process. 

May 15, 2016 04:29 PM #23
Rainmaker
1,558,065
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty - Kalispell, MT
The House Kat

Welcome to ActiveRain!

If the seller was amenable to negotiating, I'd suggest the sellers counter. Any offer can be a starting point for a successful transaction, and if these buyers really want the house, they'll bring that price up.

May 15, 2016 08:30 PM #24
Rainmaker
511,652
Rose Mary Justice
Synergy Realty Pros - Dandridge, TN
Synergy Realty Pros

Counter Always.  Many buyers still think they can buy a home at their price even when it unrealistic.  Sellers may instruct you to not present an offer below a certain amount, if this is the case then just let the buyers know this up front.

Otherwise let the negotiations begin.

May 15, 2016 10:35 PM #25
Rainmaker
1,252,215
Lorrie Semler, REALTOR® in the Dallas area. Call/text 972-416-3417
United Real Estate - Addison, TX
Real Service. Real Results. Real Estate

It is the seller's decision on what to do, not yours. You can advise, but you can't make the choice. This scenario should have been discussed before the offer even came in.

May 15, 2016 10:42 PM #26
Rainer
297,808
Gloria Laughton Allston
COLDWELL BANKER RESIDENTIAL BROKERAGE - Princeton, NJ
Realtor(NJ)/Broker(NY)

Low ball offers are part of the game and IMO should not be considered nor treated as an insult these days.  By all means encourage the sellers to counter - who knows you could end up at the number the seller wanted in the first place.

May 15, 2016 11:14 PM #27
Ambassador
2,011,991
Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES
Tropic Shores Realty - Ich spreche Deutsch! - Spring Hill, FL
Florida Waterfront and Country Club Living

Low ball offers happen, unless there are other offers on the table, ask the seller to counter it and see what buyer will do.  Sometimes, it takes a little longer to get the parties to come together. All the best.

May 15, 2016 11:58 PM #28
Rainmaker
280,399
Jeanne Gregory
RE/MAX Southwest - Sugar Land, TX
The most important home I sell is YOURS!

Look at the overall offer.  Try to get as much info from the buyer's agent as possible (maybe the buyer lost a bundle because it was a buyer's market in his previous sale), and present the offer.  Now, the seller can make the choice.  Don't add fuel to the fire by exclaiming how awful this offer is.  Stay calm.  The only bad offer is the one you don't receive.

May 16, 2016 12:23 AM #29
Ambassador
872,910
Mimi Foster
Falcon Property Solutions - Colorado Springs, CO
Voted Colorado Springs Best Realtor

Welcome to the wonderful world of ActiveRain, and congratulations on your first blog post.

When my husband and I were doing a lot of fix and flips in the early 90s, he would get upset enough at lowball offers that he would counter $10K to $15K above asking price. 

Probably not something I would do now with clients, but it always got them back in the ballpark.

May 16, 2016 12:50 AM #30
Rainer
258,612
Darrin Carey
Dayton Capital Partners LLC - Dayton, OH
Real Estate Lender for Investors

A simple reply: "Sorry, per the seller, offers in that price range are not being considered."

In the past, I've used a similar reply to the above, and I've countered at the same or a higher price.

I may double check my pricing also.

May 16, 2016 01:07 AM #31
Rainer
69,388
Shawn and Angela Miller
Berkshire Hathaway HomeServices Amabassador Real Estate - Lincoln, NE
Lincoln and Omaha, NE REALTORS®

#2 - Reject the offer with no counter and tell the other agent or buyer that the seller will not even consider a counter offer against at such a low offer.  I have done this on a couple of personal properties myself and it works well.  It's harder to do when it's not your own property.  If your sellers trust you and they agree to it, then go for it.  You would be surprised how quickly the offer comes up.... way up!  If you do counter, be sure to choose a stopping point.  Sometimes counters can go on forever, like in thousand dollar increments.  Once you hit your stopping point simply say, "This is our lowest and best.  Please tell your clients that if they cannot accept our counter, no other offer from them will be considered."  Putting the brakes on counter offers really does make the buyers stop and think seriously about it.

May 16, 2016 01:22 AM #32
Rainmaker
1,561,695
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

It's not so much the offer, and whether it can come to terms.  It's about understanding where the buyer is coming from.  That you don't know.  Are they just entering the market, never bought before and think they can offer $75K-$100K less than list?  Is that their pre-appoval amounts?  Perhaps they can't buy any higher and are dreaming, smoking, wishing . . . you never know.  Finding out if the buyer is delusional helps.  Is it worth the time of the seller?  Are they getting activity?  How long has the property been on the market?  Were they realistic in pricing?  Finding out if the seller is delusional helps.  Proceed accordingly.

May 16, 2016 04:52 AM #33
Rainer
139,001
Chrissi Chapman Topoleski
Coldwell Banker Residential Brokerage - Leesburg, VA
HOME~There is no place like it!

I am sometimes embarrassed to present them, but if it's what my client has directed me to do I will send a note that says "I hope this is something we can work with." If I am on the receiving end I don't get upset as I know the agent may be trying to negotiate or is at the very least doing what the clients says. Some agents get really mean and take a personal affront to a lowball. It doesn't necessarily mean I think it's priced wrong.

May 16, 2016 05:15 AM #34
Anonymous
Val

Responding to a lowball offer is an insult to your own intelligence and integrity. The seller have talked to few agents and have picked you for a reason, and that is they felt comfortable with your knowledge, appraisal and the selling capabilities. $100K less will cost you only $2500 in commision but it will cost the seller exactly $100K. It is in your interest to leave $2500 on the table for the chance of dumping the property and moving on. If you do so, your reputation will catch on with you. So, return a lowball offer with $2000 discount and if they come back with another nonsense offer, just ignore them.

May 16, 2016 05:29 AM #35
Rainmaker
606,907
Sharon Kowitz
CRS-SRES-ABR-GRI-E-Pro-CREN Fonville Morisey Cary, NC - Cary, NC
Cary, NC Relocation Specialist ~ Buying or Selling

You should post this on the Q and A section, I'm sure you would get a lot of feedback. You have to take it to the seller, see what they say and go from there! Welcome to Active Rain and congratulations on your first post!

May 16, 2016 01:51 PM #36
Rainer
217,926
Richard Robibero, e-Pro, ABR, SRS
Panorama R.E. Limited - Toronto, ON
Selling Your Home as if it were My Own!

I would counter. Even if at full price you need to get the ball rolling. Maybe they are seeing how "desperate" the seller is.

May 16, 2016 11:03 PM #37
Rainmaker
222,976
Mery Fernandez Empire Network Realty Luxury Brokerage
Empire Network Realty INC. - Orlando, FL
The Rise of An Empire, Let's Build Yours!

Hi Tyler! Welcome to the world of Activerain, may your blogging create a whole new chapter in your Real Estate Career.

May 17, 2016 02:45 AM #38
Rainer
160,956
Adam Feinberg
ANCHOR ASSOCIATES - Manhattan, NY
NYC Condo, Co-op, and Townhouse specialist

Recommend countering- nothing ventured, nothing gained. What is the worst that can happen- the two parties don't come to an agreement? I would rather pursue the opportunities than reject them outright.

May 17, 2016 02:45 AM #39
Rainer
75,759
Jillian La Rocque
St Thomas, VI

Sellers her get very offended by low-ball offers and usualy do not wish to negotiate with low-ballers.

May 17, 2016 02:46 AM #40
Rainmaker
566,488
Denise Hamlin, Broker/Owner
Cardinal Realty ~ 319-400-0268 - Iowa City, IA
Helping Happy Clients Make Smart Choices

I don't think the question should be what I would do. I think what you really want to know is what advice I'm likely to give a seller who gets a low ball offer.

Every transaction is different and all sellers are different. That's the first thing to take into account. In most cases I'll advise sellers to respond. Buyers typically don't make offers on properties they don't like. It's worth responding to find out how much they like it.

On the receiving end, I can say that buyers are confused if there's no counter offer. They are completely thrown and often walk, simply because the process has been interrupted. The seller countering at full price is better than not at all for that very reason. The process is important. No counter often ends up as no deal.

That doesn't mean I've never advised a seller not to counter an offer. It's rare, but it has come up. As I said at the beginning, every real estate transaction is different. 

 

May 17, 2016 03:00 AM #41
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Rainer
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Tyler Ford

Real estate agent serving Tucson, Arizona.
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