Are Lowballs Being Accepted in Your Market?

By
Real Estate Agent with Keller Williams Realty

It Blows My Mind!It's no  secret that lowball offers are on the rise, but are they getting accepted, and if so, WHERE?

I've been getting some really low ones lately, which isn't the norm for my market.  The surprising thing is that I'm hearing some are being accepted! 

This Blows My Mind!

I just had an offer for 15% below the asking price.  The buyer's agent told me that her buyer has had several of his lowballs accepted.  I asked for names and addresses of these so called lowball sales, and confirmed that this lady was not off her rocker.  I was floored.

Is it happening to your sellers?  I know they are getting the low offers, but are they accepting 10% below asking?  15% below?  20% below?  Even more than that?

I know short sales attract the low ones. We haven't had too many of those in Cary, NC.  In fact, they are rare here.  In other areas, I'm wondering if sellers are accepting lowballs and if lenders are approving the short sales on .70c on the dollar or even lower.  And if so, is that because the true market value is 30% lower, or is it because the buyers are getting REALLY good deals?

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Rainer
215,888
Frank & Jodi Orlando
Frank & Jodi Orlando Get Us A Home Realty Atlanta Homes Sale - Cumming, GA

If a property is appropriately priced, we come in at around 10% low (that is, if you really want to buy). 2 years ago in Atlanta that might be more like 5%. When we check CMA's there is usually a big difference between original list price and adjusted. That is also taken into consideration, but not much...

Aug 25, 2008 01:53 AM #10
Rainer
69,829
Kathy Fisher Sells Lexington TN homes! 731.845.3413
Five Star Real Estate Services - Lexington, TN

We are certainly getting plenty of lowball offers but few if any are accepted.  We have an absorption rate of about 7 so we are barely even a buyer's market much less a market where these ridiculously low offers would be entertained!  Thanks but no thanks!

All the Best!

Kathy Fisher

Aug 25, 2008 02:01 AM #11
Rainmaker
87,320
Mary Sitton
Mary Sitton Real Estate Team - - Hendersonville, NC
Realtor® - Hendersonville, NC and WNC Area

Homes in the $400K+ range are receiving and accepting low ball offers.  We have a 10 month inventory on our hands and buyers are taking advantage of offering less since they can move on to another seller who will take their low offer. This is for Asheville NC and Hendersonville NC.

 

Aug 25, 2008 02:05 AM #12
Rainmaker
67,383
Cathleen OnullHannigan
Keller Williams Realty - Cary, NC
Cary NC Homes Pro

Frank & Jodi, Wow, priced right ant 10%!  Blowing my mind!

Kathy, your market sounds hot!

Mary, thanks for checking in with Asheville market info.

Aug 25, 2008 02:18 AM #13
Ambassador
272,883
Eleanor Thorne
Equity Resources - Cary, NC
Equity Resources 919-649-5058

We are seeing new home CUSTOM builders drop prices by $40K because their lines are being called - so this could be part of the problem...

Aug 25, 2008 03:42 AM #14
Rainmaker
312,366
Rob & Jeannie Steward - Realtors®
RE/MAX Advantage - Nashville, TN
We Work TWICE As Hard For You! - Ashton Group

In our office we just had a home that sold for $1,395,000 in 2006 finally close after 10 months on the market.

This will make you ill...

Closed at $895,000

What was it surrounded by comps wise?

You guessed it...  Short Sales!

Aug 25, 2008 06:49 AM #15
Rainmaker
1,036,503
Kathy Clulow
RE/MAX All-Stars Realty Inc. Brokerage - Uxbridge, ON
Trusted For Experience - Respected For Results

Cathleen - Are they really low ball or is the asking over priced - Market value is determined by a willing seller ....... willing buyer  ...... and all that. Agents do not determine it, they report on what was and what may be but unless the seller is under duress of some nature when they accept a "lowball" offer then the property was overpriced to begin with.

Aug 26, 2008 08:32 AM #16
Rainer
27,706
Tracy Soussi
Charlotte, NC
NC & SC Broker - Large Bank Foreclosures

I am in the Charlotte, NC market, alot of short sales and inventory.  The homes that have been on the market a long time are taking a beating but not the others.  Lot prices are selling at great prices on the water. 

 

Aug 26, 2008 12:56 PM #17
Rainmaker
67,383
Cathleen OnullHannigan
Keller Williams Realty - Cary, NC
Cary NC Homes Pro

Eleanor, yeah, I reckon a big part of the reason is the builders slashing prices.  Absolutely

Rob and Jeannie, Yike.  I experienced a lot of that back in 91 in Westwood, CA.

Kathy, Who knows these days? 

Tracy, I didn't know you all had water up in Charlotte. I'm going to have to visit soon.

Aug 27, 2008 05:25 AM #18
Rainmaker
249,857
Mike Klijanowicz
Cummings & Co. Realtors - Perry Hall, MD
Associate Broker @ Cummings & Co. Realtors

It really depends on the house, the price range, and the community.  As primarilly a listing agent, I advise ALL of my sellers to look at EVERYTHING that comes in and to never just flat out refuse an offer no matter what it is.  The worst they can do is counter and let the buyer say no, but never let it be your client who says no if you are a sellers agent, instead end on a counter (if this is what your client wants you to do, since we ultimately have to do what they want!  That is just my advice)...

Aug 29, 2008 12:31 AM #19
Rainer
31,575
Linda Breeding
Keller Williams Realty - Pinehurst, NC

We have gotten low ball offers here too and it is really not our market either. Most do not "fly" but there will always be a few that will.

Aug 29, 2008 02:37 PM #20
Ambassador
3,090,321
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

Cathleen:  Your question is one of chicken and egg.  If buyers are getting great deals, their sales become comps which in turn make up market value.  In these "steals"  you really need to look at condition of the home too.  Not all sales are created equal these days.  Homes may be trashed, missing all appliances.  Who knows?

Aug 30, 2008 04:04 AM #21
Rainer
71,135
Jim Fischetti
The Fischetti Group/Keller Williams - Wake Forest, NC

Yes, there are certainly some sellers taking offers at considerably less than asking price. Plus the increase in short sales and REO's will result in more agressive offers.

 

Good luck

 

Jim

Aug 30, 2008 04:51 AM #22
Rainer
35,002
Lisa Southern
Lisa Southern Real Estate - Raleigh, NC
Lisa Southern Real Estate

Hi Cathleen,

  The influx of people from other parts of the country has spurred low-ball offers for a variety of reasons. The buyers are frustrated that they had to accept a lower offer on there property and want to get a better deal here, the process works like that where they are being transferred from, and lastly depending on the length of time the home has been on the market and sensing a "STEAL".

Sep 08, 2008 04:01 PM #23
Rainmaker
601,332
Donne Knudsen
Los Angeles & Ventura Counties in CA - Simi Valley, CA
CalState Realty Services

Cathleen - I'm a mortgage lender in Ventura County (SoCA) and I have a few clients who are perpetual low-ballers and none of their offers are getting accepted.  So, in an effort to educate myself on the areas that they were interested in, I did some research on what many of the REO's, in these areas (by census tracts or condo code) in their price ranges (200k-400k), were being sold at. 

In every area, there was one or two properties that were outside of the median averages (higher or lower) that kind of skewed the end results.  However, most of the properties in these areas and price ranges were selling between 92% - 102% of the listed price, which was why my clients offers weren't being accepted because all of their offers were between 12%-21% below the listing prices.  After I conducted this research, I had a chance to talk with one of my clients Realtors and he explained that he had pretty much advised the client the same thing but that our client was just simply not listening to him.  This particular client is just adamant about getting a "great deal".

Sep 09, 2008 09:05 AM #24
Rainmaker
67,383
Cathleen OnullHannigan
Keller Williams Realty - Cary, NC
Cary NC Homes Pro

Michael, thanks for stopping by.  I'm getting real low ones and real mad sellers.

Chris, yes, it blows my mind how people flock to new homes & turn their noses up at older ones.  I came from CA where it was just the opposite.

Jim, yes, you are right!

Lisa, thanks for your advice.  So nice to hear from you again.

Donne, thank you for weighing in.  I miss SoCA, and remember Ventura well.  Loved camping in at Carpinteria State Beach every summer.

Sep 10, 2008 02:00 PM #25
Ambassador
521,939
Tracy Santrock
Fonville Morisey/Santrock Realty Group, Inc. - Cary, NC
Raleigh - Cary Realtor/Broker In Charge

Cathleen,

You never cease to amaze me! Username: Al Pacino Yet another good one.. time to read above so I don't get blasted for not reading your post.

Sellers are shocked by the fact that offers are coming in so low.  I'd like to use my neighborhood as an example.  Ex. 1.  You know the property.  Last year $699.  This year $589k no offers and limited showings.  Then, around the corner in my neighborhood - Tax value $750k FORECLOSURE ON THE MARKET THIS WEEK FOR $669K!  90K UNDER TAX VALUE.

In the high prices with high inventory the market has made a dramatic shift and sellers keep reliving the golden days.  Time to wake up if they want to sell/

Sep 13, 2008 02:07 PM #26
Rainmaker
49,764
Ken Williams
CarolinaLand.Com - Lake Lure, NC
Log Homes, Mountain Lake Real Estate Services

Hello Cathleen

I have had a lot more buyers this year that seam to be able to ask for discounts and make low offers, and because of the general state of the market  my seller seams a lot more ready to except these lower offers.

Last year at this time my sells would almost never come down off the listed price.

 

By the way we are not far from you and we love referrs,

Right now I have a new custom built log cabin shell on 1.7 ac priced at only $89,900 I also have some great mountain view and water front home sites starting at only $29,900.

Check out my web site www.carolinaland.com for all the details.

Thanks

Ken Williams

828.429.4004

CarolinaLand.Com

Sep 14, 2008 03:44 AM #27
Rainmaker
66,146
Lisa Long
Heather Roda Broker - Paso Robles, CA

Here in Paso Robles we are seeing low offers rejected, especially by the bank. We are actually seeing the reo properties have multiple offers!

Sep 14, 2008 04:03 AM #28
Ambassador
521,939
Tracy Santrock
Fonville Morisey/Santrock Realty Group, Inc. - Cary, NC
Raleigh - Cary Realtor/Broker In Charge

Ok,  another rumer around the office..agent  writes an offer on a $200k home for $120k.  In this price range - they just don't get it!

 

Sep 16, 2008 01:10 PM #29
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Rainmaker
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Cathleen OnullHannigan

Cary NC Homes Pro
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