How To Handle Unreasonable Low Offers

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Real Estate Broker/Owner with Phoenix Property Shoppe AZ Broker BR030809000
https://activerain.com/droplet/5hSH

How To Handle Unreasonable Low Offers

How To Handle Unreasonable Low Offers

 

So you've been working with an experienced agent to get your home on the market  and it's priced within what comparable properties have sold in your area. A few days on the market and along comes not only a low ball offer but a quite  unreasonable low ball offer with mutiple contingencies. I call this kind of offer a "double whammy" offer! A recent story below, will explain How To Handle Unreasonable Low Offers. But, the first piece of advice I give  to sellers is  - don't get mad or emotional about unreasonable, low or both type of offers. I know How To Handle Unreasonable Low Offers logically and effectively and can guide you through the selling process.

 

The story. Our sellers priced their home correctly for their area and their competition which were a LOT of $1M ++ brand new homes, selling fairly quickly, with all the bells and whistles buyers are looking for in today's market. While the sellers home was absolutely lovely and included a guest house, pool house, 4 car garage and RV garage it was a bit dated so we priced the home with that in mind.  I knew the right buyers would come along and see the incredible value of the home, amenities, gorgeous acre lot and gated community.

 

The first offer on the table came in and I couldn't believe it and I had to look twice at what a ridiculous "double whammy" offer it was!  It was an unreasonably low offer and add to that, it was contingent on 2 homes selling and closing - that weren't even on the market yet - plus a bogus approval letter was submitted with the offer for one of the buyers. Seriously? I am sure you can see all that could go wrong in that scenario! The sellers stayed calm and decided to turn down the offer. I  left communication open with the buyers agent stating that the sellers would be open to the buyers submitting another, reasonable offer including the terms and conditions that the 2 homes would be, at the very least in escrow, and to submit proper proof of qualification for these buyers as well as for buyers on their homes in escrow.

 

Yes I know, it sounds complicated! At times dealing with multiple offers is very complex, but we have closed many homes with multiple buyers and sellers over the years so it can work out successfully. The above buyers were blending 2 families and I had a feeling they were not all on the same page about living together. They had looked at the home 4 or 5 times and it seemed one family wanted it more than the other. I never heard from their agent again so my hunch was spot on, the buyers weren't that serious or they would have submitted a reasonable offer to begin with or at the very least the 2nd time around.

 

A few weeks or so later, the sellers did receive a reasonable starting offer, with proper qualification from another buyer. With a little back and forth negotiation they did come to a meeting of the minds and it closed 30 days later. Success for the sellers and buyers - a win win.

 

As I mentioned above, it's always a wise idea to stay calm after receiving a less than reasonable offer, especially while attempting to negotiate a  better, reasonable offer. And sometimes, as this story tells, some offers simply are not workable and it's wise to move forward to the next offer. The key to handling unreasonable and low offers is to hire an experienced agent that knows the market well and can guide you through the process as seamlessly as possible. If you are thinking of selling or buying a Phoenix area home, give me a call and let's talk.

 

Originally Published at Phoenix Property Shoppe

 

 How To Handle Unreasonable Low Offers

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Phoenix Property Shoppe
  

 

 

Anna "Banana" Kruchten
Designated Broker & Owner
CRB, CRS, GRI, CNE, SFR, CDPE, WLS


Phoenix Homes For Sale

 

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Tags:
low ball offers
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Rose Mary Justice agreed! Serious buyers would have their homes already sold and not 'think' they can 'play' with the sellers for months on end.

Apr 23, 2019 09:46 AM #49
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Laura Cerrano well said my friend!

Apr 23, 2019 09:46 AM #50
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Richard Bazinet /MBA, CRS, ABR agreed stay calm, cool and collected! Interesting thought - predatory buyers. That sums it up.  Hey we need to create a meetup one of these days.

Apr 23, 2019 09:48 AM #51
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Derrick Guevremont yes we have our share of new and inexperienced agents here as well. But we were all new at one point!

Apr 23, 2019 09:50 AM #52
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Buzz Mackintosh I learned this my very first year in the biz. Sometimes countering low balls is simpy not worth it.  Way back then (late 80's) the buyers did pony up a reasonable offer and we got the home closed for the sellers - all thanks to my brokers mentoring on how to deal with this type of offer.

Apr 23, 2019 09:52 AM #53
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Maria Gilda Racelis it is always so nice to have cross sales with great agents! In this case the offer that was successful the agents were very professional.

Apr 23, 2019 09:54 AM #54
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Lorrie Semler, REALTOR® in the Dallas area. Call/text 972-416-3417 what a great idea. Please send me a copy of that form. That would be very helpful.

Apr 23, 2019 09:55 AM #55
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Sam Shueh well if it had been my buyers and not my listing I would have prepared the buyers well in advance before they even began looking for a new home. That's why they hire us.

Apr 23, 2019 09:57 AM #56
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Jill Sackler agreed.  Go over all the different scenarios that could play out for the sellers and then let them decide.

Apr 23, 2019 09:58 AM #57
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Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

All offers must be delivered, yet only those with reasonable offers should be analyzed and reviewed. So, why would an intelligent, experienced buyer's agent deliver an unreasonably low priced offer? The only possible conclusion is the buyer's agent lacks the intelligence and experience or is there another possible reason? 

Apr 23, 2019 08:40 PM #58
Rainmaker
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Carolyn Roland-Historic Homes For Sale In Delaware and S. Chester County PA
Patterson-Schwartz Real Estate - Wilmington, DE
Carolyn Roland, GRI, CRS

I was taught that our duty was to present all offers. It is up to the seller as to whether they bother to counter, reject, or accept them.

Apr 23, 2019 09:00 PM #59
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Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

Hey Anna,
Guess I missed this in all the activities of the month.  Sellers do get offended and emotional about low-ball offers. To a professional agent, it's just business and you either try to work with it or move on.  

Apr 26, 2019 07:49 AM #60
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Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good morning Anna Banana Kruchten CRB, CRS 602-380-4886 - glad you also had reasonable sellers who did not react emotionally.  That got them to the closing table.

Apr 27, 2019 04:43 AM #61
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Kimo Jarrett agreed. The agent reminded me that he was in the top 1% of producers in his area. Top 1% agents know this kind of non-offer will fly.

Apr 27, 2019 11:10 AM #62
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Carolyn Roland-Historic Homes For Sale In Delaware and S. Chester County PA t is indeed the sellers decision, always up to them what they want to do. It's my position to guide them and give them my exeperienced thoughts as to what works and what may or may not fly.

Apr 27, 2019 11:13 AM #63
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Hi Carol Williams what? Are you talking about the week you crammed 3 weeks of stuff into LOL!! These sellers did not get offended, very savy sellers. 

Apr 27, 2019 11:14 AM #64
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Anna Banana Kruchten CRB, CRS 602-380-4886
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Grant Schneider indeed, very smart and experienced sellers to work with - they did everything they needed to do to make it all happen.

Apr 27, 2019 11:15 AM #65
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Ricardo Mello
Manhattan Miami Real Estate - Manhattan, NY
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Stay calm 

May 01, 2019 11:14 AM #66
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John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Your story is one that has often been seen, low ball offers.

You gave a great piece of advise when you stated: Stay calm.

Then, keep the communication open. I advise sellers to respond to all offers.

There are so many buyers who still believe they can "steal" a property at prices of 5 years ago. But they often quickly come into reality and buy at a more appropriate price.

Good post.

May 13, 2019 09:36 AM #67
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Margaret Rome, Baltimore Maryland
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Anna Banana Kruchten CRB, CRS 602-380-4886 Thanks for sharing this post. When I get that "double whammy" I tell the sellers we have good news and bad news. Which would you like first? The good news...we have an offer.

May 14, 2019 04:58 PM #68
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