OK, So a long time friend of mine who wants to move from Long Island, New York to Fort Myers, Florida. He calls me tonight to get some information on 2 homes. I give him the information on the two homes he is inquiring about. Now he was in Fort Myers about a week ago, and drove by these homes. He wanted to know what the original owner paid for the homes back in the late 90's. I tell him they paid about $185,000 back in 1999, I believe. Anyway, he proceeds to tell me that he is going to move there in about a year to a year and a half. I said to him, so why are you bothering me now to look up information on these homes, they won't be on the market by the time you get here. Well in his mind, he thinks they will be, I laughed at him. I said I doubt it, and if they are the market will be different market at that point. Well to cut to the chase, he says to me I am going to offer $150K, they are listed for $265K. He tells me he has all cash and wants to steal one of the two homes. Again I laughed, I asked my friend are these homes in a bad area, he says no ( I am on the East Coast of FL.) I ask him are the homes in need of repair, he says no. They are in a great area and are in move in condition. Then I asked him, what makes him think they will take his offer. Well he says I am doing the bank a favor by giving then this offer, the bank is hurting so bad they will jump at this. Again I laugh, I said what makes you think the bank is hurting so bad they would take your offer. I told him if the bank is hurting so bad they can reduce the house way below market value and they will have a line of people/investors to purchase the home. I told the bank is going to look at fair market value. The bank is not going to just drop there price that low, in most cases, because you are offering all cash. He then says, well I never thought about that. He then tells me he wants a good deal, so I ask him what his is plan. How much are you going to offer below fair market value for a purchase to be a good deal to you? Then the truth comes out, he can only afford $150K for a house, so in his mine that would be a good deal. I told him you wasted enough of my time, and hung up the phone. Now, I have bought homes under value, but I had a plan and no emotional tie to the out come, it was strictly business. It amazes me how people think they can make such low ball offers on property where there is no incentive for the owner/bank to drop prices to a ridiculus number. Now, how many times in a week do some of you hear this similar story, either by a client or someone you run into. I always respond to people like this with. OK, we are going to line up 100 homes and make low ball offers on each one to see if anyone bites. They usually back away once they hear that. I think the offers on 100 homes scares them. Well, just my little rant for today.
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