Fueling the Buyer with Emotion

By
Real Estate Agent with Century 21 Elite Performance

I've noticed something lately.  Have you noticed some of the extremely unfounded lowball offers lately? Now, I'm not talking to you if your seller hasn't competitively priced their home in relation to current inventory and past sales, I'm talking to the agent whose seller is fully informed and has done just that... inform their sellers and thus help them determine a competitive price that will bring in the offers.  It's as if the buyers agents have gotten their clients so geeked up on "getting a deal" and "getting a deal" means getting tons of money off of the last list price - and without looking at the market around them? If we were the sensitive type we might even get our feeling hurt thinking that the buyers agent must think we're dummies and we didn't do our homework for our sellers - as in didn't inform and all that time we spent at the listing table determining price was all for naught.  Why? 

fuel up

I think it's because sometimes agents get too emotionally involved.  Hey we're all guilty.  I don't think you can help but become emotionally involved when working with buyers and sellers, not if you're doing your job right - after all this is a people business is it not?  But, some agents I think get overly emotional - to the extent of this particular situation. "Hey, I'm going to help you get the most off - you're going to get a great deal!  This is a BUYERS market!" Apparently those phrases are like crack to a crack addict because buyers are taking that to the offer table and quite honestly it's embarassing. I would almost expect a written apology from both the agent and the buyer to accompany the offer as part of an addendum. 

The riduclous low ball on an already competitively priced home.  I'm glad my sellers have had the fortitude to stick it out for the right offers and say nay to most of these ridiculous ones.  I guess what I'm doing here is preaching - and I vowed not to do that when I got on here - as I've always got an opinion.  But in this case it's just a little nudge of advice to anyone to whom this may fit - "please stop getting your buyers geeked up on money off and get back to basics and inform your buyer so they have an over all view of the market." 

Or simply ad the following addendum to all of your future offers. 

ADDENDUM #1  Buyer apologizes for insulting the seller with this ridiculous offer but buyer is so completely out of his mind on "emotional crack" from his or her buying agent, that the buyer requests an acknowledgement of this apology in the form of a formal rejection.  Buyer also requests a new agent and will forever be bummed out that their pride was tied into such a ridiculous offer in such a way they can no longer bare the thought that they painted themselves into a corner which does not allow them to buy the very house they would like to buy and so remain bewildered.

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Rainmaker
130,480
Kevin O'Shea
Coldwell Banker - White Plains, NY
White Plains, NY Real Estate

Our market has only been soft for a little over a year here.  The sellers and many Realtors haven't seen a market like this before.

So when someone comes in with a low offer neither the seller nor the Realtor are responding well.

Many buyers have been told or read that they should start their offer 10% or more lower.  That isn't always realistic.

Your post is true, but all of us agents must try to educate the buyers and sellers.  If we can get the buyers and sellers on the same page we will all have more deals.

All the best!

 

May 22, 2008 12:25 PM #1
Rainer
14,444
Jon Higgins
Century 21 Elite Performance - Springboro, OH
ABR

Thanks Kevin for your thoughts.  Cheers.

May 22, 2008 12:27 PM #2
Rainmaker
80,020
Jon Boyd
Home Buyer's Agent of Ann Arbor - Ann Arbor, MI
Ann Arbor Real Estate Buyers Agent

Interesting post John. I like your point about agents not getting their emotions tied up in the offer.

At the same time I'm sure you've shown a lot of homes that were overpriced. I know I have. Should we hope for a seller's apology for ignoring current market data and trend data when they determined their asking price?

Or...

We made an offer on a home in December. The asking price was about $600,000 and the seller and/or listing agent thought our offer was way too low at around $485,000. They didn't even respond. Maybe that was under the value. But since the $600,000 home is still on the market now almost six months later we should all be able to agree that $600,000 is too high.  Right?

And in this case the $485,000 is closer to the actual value than the $725,000 original asking price. (Don't worry, my buyer clients weren't insulted by an asking price ~25% over market value.)

Just some friendly input from the buyer's side.

 

May 22, 2008 12:51 PM #3
Rainer
14,444
Jon Higgins
Century 21 Elite Performance - Springboro, OH
ABR

Jon - dually noted but in the second line of my post it reads, "I'm not talking to you if your seller hasn't competitively priced their home in relation to current inventory and past sales" so yeah I get it.  I wasn't addressing the Realtors and their clients who have appropriately priced their home.  I'm talking from the stand point of those who have looked the market square in the eye and priced accordingly.  Cheers.

May 22, 2008 12:58 PM #4
Rainer
10,839
Katherine Anderson
Coldwell Banker Hobin Realty, LLC - Hampton & Rye, NH, USA - Exeter, NH
Managing Broker

Hi Jon:  Yeah, we are seeing low-ball offers here in NH as well.  The first question that we ask the buyers agent is "How did you come up with this offer".  You'd be surprised how many times the agent says that this is what the buyer wanted to offer.  So many agents don't educate their buyers on the market and negotiations prior to submitting an offer.  It's a shame for all involved.  BTW... I'm from Centerville, Ohio.... just wanted to say hi as a fellow Buckeye!  :-)

May 23, 2008 02:35 AM #5
Rainer
14,444
Jon Higgins
Century 21 Elite Performance - Springboro, OH
ABR

Katherine, thanks for dropping by and saying hi to a fellow Buckeye!  We see Buck"eye" to eye.  :-)

May 23, 2008 03:42 AM #6
Rainmaker
193,804
Mary Strang
Viroqua, WI

Jon, I think you addendum is a must on many a offer lately, if nothing else it would be good to prepare it for buyers signatures just as a reminder of what will likely happen, no sale to them!

May 26, 2008 02:47 AM #7
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Rainer
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Jon Higgins

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