—until you KNOW what they’re praying for!”
I try to have a forthcoming conversation with the listing agent before presenting an offer. I want to know “What are the hot-buttons for your Sellers?”—Quick close, cash deal, will they take a contingency as to the sale of a buyer’s home? Want to trade (we have many folks moving down)? Can they carry paper? If my offer is going to be the answer to their dreams then let me know what they are dreaming of! Make sense?
Pricing --Bringing Seller or Seller’s agent to reality: Sometimes we get hung up on small amounts relative to the overall value of a home. A recent transaction saw the seller and buyer hung up on $2500 on a $550,000 Condo purchase price. Seems trivial right? I mean it’s less than ½%. But the infamous phrase: “It’s the principle!” gets in the way every time. In this case I had to demonstrate how the $2500 should NOT stand in the way of having a client buy or sell a home. In this case, the buyer was looking at another Condo with an HOA with $450.00 monthly dues vs. this HOA at $200.00. That’s $250/month for a savings of $3,000 a year. So the first year he recouped the price increase in 10 months. Plus if he was going to live in the unit for 10 years its gets to the point of being trivial. The old phrase: “reduce it to the ridiculous” prevailed.
Negotiate—some Buyers just can’t do full price. We have plenty of buyers who have lost a home because they didn’t step up to the plate with a full or over asking price offer. If you insist on going in low then you better have a big offset—no contingencies? Perhaps shorter inspection periods or maybe a quicker close. If you’re going to get you better learn to give. Or go in at full price and ask for stuff—lawn mower, tractor, furniture—hey, some folks are moving down.
Leave Contingencies to a minimum. Physical Inspection contingency should be the absolute one you wish to keep UNLESS you have a contractor or “flipper” client with a world of expertise who can sort out a home with a fast walk-through. Many Realtors/Agents have pest reports done prior to the listing and some Home Inspection Reports. These are great money and time savers! Shorten up the time frames for this.
Make Multiple Offers? Be careful with this one. The essence of negotiations is “good faith” in a contract. Be careful of fraud. If you are buying 3 houses that’s find. But if you are only going to buy ONE of the three you have offers on then disclose what you are up to and WHY! I had a client, in for the weekend on a job transfer and needing to buy a home, make three offers with instructions to me to inform the seller as to WHY he was doing this. He had me present to the #1 house first and wanted me to tell the seller, “Folks, my client wants your home badly but he needs to know when he goes back east that he has a home to move to. He wants your answer immediately. If you can’t do this I’m instructed to present offer #2. This repeated with #2 as I moved to #3. I didn’t get to #2. You may think this was pressure on the Seller but the house had been on the market for some time and we assumed the seller KNEW what they wanted.
Follow up with listing agent in case you did not get your offer accepted. Ask to be in back-up position. I had presented an offer on a Multi-Million dollar estate and was representing a very high powered attorney. He got beat out by an “in-house” deal as the Seller was an agent. I wasn’t happy how it went down so insisted we be given “back-up” offer status. It took me some convincing to get my attorney client on board. He grudgingly acquiesced. 2 days later I get a call from the listing agent, buyers realize it is too far out for them from the city. Boom! We’re in first place. I got to make a very nice call to my client who also got to tell his wife “We got the house”!