A New Tool for Sellers?

By
Real Estate Agent with Keller Williams Realty - Atlantic Shore

question (sxc)

Has anyone tried this, and if so what kind of results have you had?

I read recently of some new tactics, to get home buyers the pull the trigger, that are surfacing around the country.  One tactic is an offer written by the seller!

It's called a reverse purchase agreement, an unsolicited offer that gets written by sellers for prospective home buyers.  According to RISMEDIA some agents say that the strategy could be the next weapon in the ongoing battle to get home buyers to take notice and get off the fence.
 
Since home buyers control the market now, with so many choices, there's really no incentive to decide on a purchase quickly.homes (sxc)

One agent had a market worn listing.  
After months on the market, professional staging, aggressive price reductions and weekly Open Houses, there was one qualified out of town buyer who viewed the property twice.  There was interest and his agent continued to keep in touch with the listing agent.  So there was hope that this might turn into an offer.

But months later, still no offer. The buyers agent continued to keep in touch with the listing agent, so there was some interest.

contract (sxc)With no other prospects in sight, the listing agent and his clients decided that if the buyer wouldn’t make an offer, they would. So they wrote an offer, complete with a quick closing date and an unsolicited $10,000 price reduction on top of a $20,000 price reduction earlier in the month.

The prospective buyers are reviewing the sellers offer and haven't yet made a decision.

I'm wondering if this might be a way for sellers to gain a little control in this buyers market.  What do you think?

Keller Williams
Atlantic Shore
Laura Giannotta
609-384-6121
Homes in Waretown, Barnegat, Manahawkin, Long Beach Island, Little Egg Harbor and Tuckerton!
www.JerseyShoreViews.com

Comments (20)

Diane Daley
Caron's Gateway Real Estate - Northumberland, NH

Interesting idea and concept I have never hear of it nor have I tried it but for the motivated seller it might just be what needs to be tried to get the buyer interested.  If you try it I would be anxious to hear how it worked out.  Thanks for sharing, If I could re-blog this maybe someone out there has tried it with success....

Jan 13, 2009 12:15 AM
Toula Rosebrock
Diane Turton, Realtors, Forked River, NJ - Lacey Township, NJ
Broker/Sales Associate, Realtor, Lacey Township,

Hi Laura:

HMMMMM...that's an idea!

ToulaRosebrock.com - DianeTurtonRealtors.net

Jan 13, 2009 12:19 AM
Mike Klijanowicz
Cummings & Co. Realtors - Perry Hall, MD
Associate Broker @ Cummings & Co. Realtors

Interesting concept and I think is a VERY AGRESSIVE WAY TO DO BUSINESS THAT MAY JUST WORK!  I think you have to have to buyers on the fence though, you can't just arbitrarily draw up an offer and give it to everyone who comes through the door, IMO...

Jan 13, 2009 12:23 AM
David Henke
Long & Foster Real Estate, Inc - Newtown Square, PA
Realtor, Homes Just West of Philadelphia PA

I've never seen this done but I can see how this could be effective - especially with first time buyers.  Not only does it aggressively open the discussion, it also provides potential buyers with a roadmap to the purchase.  No longer are they discussing making an offer, they are now discussing potential terms - seems like a big hurdle jumped.

Jan 13, 2009 12:24 AM
Evelyn Panning
Property Connections Realty Inc. - Alturas, CA

That sounds like a lawsuit waiting to happen.  I'll pass. ~ Evelyn

Jan 13, 2009 12:57 AM
David Width Jr.
Little Egg Harbor, NJ

Laura I have heard of this before, actually at the CREN (certified real estate negotiator) class. I have never tried it myself but I have heard of it. I may try this when the time seems right. It only seems that it would work in a very unique situation. 

Jan 13, 2009 12:59 AM
Matt Stigliano
Kimberly Howell Properties (210) 646-HOME - San Antonio, TX

Laura - Now what happens when that buyer rejects the offer...do the sellers then keep their new price (with the extra $10K reduction) or stick with the last price reduction and hope someone goes at that?  If they're willing to try it at $10K under their last price, I would advise them to just do a price change and see if the offers come in off of that....if it really is a nice price at that level, then they should be able to find a buyer.

Jan 13, 2009 01:08 AM
JL Boney, III
Coldwell Banker - Columbia, SC
Columbia, SC Real Estate

I have not tried this, but I have heard of it. I kind of like the outside of the box thinking that it implies.

Jan 13, 2009 01:24 AM
The Rains Team
Keller Williams Realty Atlanta Partners - Hoschton, GA
A higher standard in real estate

Hi Laura, This is definitely an interesting idea to think about; one I'd never heard of before. I'm not sure if I would try this or not. I wonder if this has worked for others? I would be interested in hearing their stories and input regarding this concept.

Thanks for sharing!

--Anne Rains

http://activerain.com/blogs/ladyofrealty 

Jan 13, 2009 07:36 AM
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

It should get the buyeers attention...the buyer may fing they are getting a better deal than they would have offered!

Jan 13, 2009 07:40 AM
Laura Giannotta
Keller Williams Realty - Atlantic Shore - Little Egg Harbor, NJ
Your Realtor Down the Shore!

Hi all, thanks for coming by and the great comments (I'll get back to each of you soon)...I have a couple of questions from your comments..

First, yes I think it only applies to a buyer who has expressed interest, but Evelyn (from Property Connections) where's the law suit?

As for lowering the price, the point here is that there is someone interested at that price, but hasn't moved off the mark.  This opens the discussion.

When I hear more about this, I'll post.  I just thought it an interesting way to give a little power to the sellers!    

Jan 13, 2009 08:34 AM
Craig Rutman
Helping people in transition - Cary, NC
Raleigh, Cary, Apex area Realtor

Quite an interesting concept. I can see this happening more often during these trying times.

Jan 13, 2009 01:06 PM
Alyce Martin
The Realty Group, LLC - Albuquerque, NM
Albuquerque - THE Place To Be!

Hi Laura - I read about this too but haven't heard of anyone using this technique yet.  Guess it would depend on a lot of different circumstances, motivation levels, etc.  Don't know about a law suit (?).  I'm all ears but a little guarded.

Jan 13, 2009 01:38 PM
Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

Laura, I have heard of this kind of offer but never seen it in practice.

Jan 14, 2009 01:38 AM
real estate real estate
Providence, RI
Laura, fantastic idea. Think right in buyers' shoes. I think if the price is right plus seller's protection, there is really no reason to NOT buy the specific property.
Jan 14, 2009 06:30 AM
Scott Guay
Berkshire Hathaway Home Services PenFed Realty - Ocean Pines, MD
Associate Broker. Ocean City and Ocean Pines MD

SOunds like it could work if you knew you had a buyer that was on the fence.  It is like countering the offer you never got.

Jan 14, 2009 06:42 AM
Susan Mangigian
RE/MAX Preferred, West Chester, PA, RS152252A - West Chester, PA
Chester & Delaware County Homes, Delaware and Ches

This is an interesting way of doing it.  I like it, and it is certainly worth a try.

Jan 14, 2009 12:09 PM
Daniel J. Brudnok, REALTOR
Berkshire Hathaway Home Services Fox & Roach, REALTORS - Exton - PA License #RS-225179-L / Delaware License #RS-0025038 - Downingtown, PA
SRES, e-PRO,ABR,GREEN,CSP

Laura,

I have read many of the articles on them, have yet to try myself....I see no way it can hurt.

Jan 15, 2009 01:04 AM
Laura Giannotta
Keller Williams Realty - Atlantic Shore - Little Egg Harbor, NJ
Your Realtor Down the Shore!

Everybody seems to think this is an interesting idea, and it's worked for Pattie Romano...just another  something for our bag of tricks!  (Like Felix the Cat!) 

Jan 16, 2009 11:49 AM
Wanda Thomas
Montana Homestead Brokers, Broker, CRS, GRI, SFR, RN - Billings, MT
Billings Montana Real Estate

The idea makes me think that the offer gives the seller a sense of power by having the offer in writing.  It may be just as important as the offer in writing going the other direction.  I know when I get a call about a buyer wanting to make an offer on a listing I always say "put it in writing".  Kinda the same thing only in reverse.

Jan 22, 2009 09:42 AM