Sometimes sellers choose to price their houses high for the current market and they sit for awhile. Sometimes when they sit, buyers think they are becoming desperate and want to submit a really low offer. Othertimes you have buyers who just want to make sure they are getting a good deal and not leaving any money on the table.
How do you respond when a buyer submits a low offer? Some sellers get angry. Why would you get angry when receiving an offer on your house? If you have a person that has come into your house, walked through it, and likes it more than any other house that is on the market, takes the time to think of and prepare an offer for your house, that means they really like your house! Instead of being upset over a low offer, be happy that someone likes the house enough to write an offer!
I've never had a seller do this, but we just received this response to an offer that my buyer submitted:
The problem with this OFFER REJECTED response is the seller had no idea how high my buyers would have gone if they had just countered. The house has been on the market for 90 days with no price reduction and it's priced too high. They feel it's worth what they are asking, but the market is telling them that it is priced too high because they don't have an offer.
Now the sellers will never know how much my clients will pay because they are moving on to the next house. This house is a nice place, but there will be others. There are very few unique homes on the market and there are always more that will come available.
Every offer should be the beginning of a conversation. Our job as professional Realtors is to help with that negotiation and try to come to a meeting of the minds.
This particular offer was submitted on Sunday afternoon and was not presented until today - TUESDAY - by the listing agent. The agent casually told me that when receiving the offer. Maybe he didn't like it? No rush? This house has been on the market for 90 days with no offers or price adjustments. I know they don't have to get asking because I know their payoff amount (a good agent does their research), but I also understand that they want a certain amount. I know the house is vacant and seeing the multiple refinances, I would assume they are not independently wealthy and are paying that high mortgage every month the house sits vacant.
We had one case where we represented the seller who was selling a townhouse and it was the nicest in the neighborhood. They were asking $275k and we got an offer in for $230k. Instead of rejecting the offer, the sellers countered at $269k and you know what happened? The buyers ACCEPTED THE COUNTER. The buyers assumed because we countered only a small amount, that this was likely as much as they were going to get and it was a reasonable price for the house.
What does it hurt to counter a low offer? If you're on the market more than a month without a price reduction, the market is telling you the price is too high unless it's a really unusual home (small potential buyer pool) or a very slow market.
Don't counter a lot if you don't want to, just give something to keep the conversation going and see if you can make a deal. If you're listed at $400k and you get an offer of $350k and you have decided that you'll only come down to $390k, then counter at $390k. If they counter back, tell them that's the best you can do, maybe offer a home warranty and see what the response is. At least you'll know that you had the conversation and you might even make a SALE!
