This is the 3rd and final installment in a series entitled “The Art of Offering Less” and deals with the unique nuances associated with tendering an offer that is lower than the asking price.
In the 1st article we discussed the market dynamics that tend to encourage or breed low offers.
In the 2nd article, we shared various strategies for Buyers to achieve success with low offers.
In this final part, we’ll talk about the risks that are inherent with making low offers.
To read the rest of this article, simply click through to SOUNDBITEBLOG. (Opens in a separate window for your viewing ease)
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Rich Jacobson is a licensed real estate professional providing knowledgeable empowerment and relentless representation for his clients of residential properties and vacant land throughout all of Kitsap County WA and portions of Pierce, Mason, and Jefferson Counties. You can also find him at KitsapLife.com, SOUNDBITEBLOG, and Crabbing in the Hood.
Rich, I'm off to read all three of these posts. How on earth did I miss the first two? 'Hope all is well in Kitsap County.
Rich,
Thanks for the post. I am in agreement with Margaret. I have some reading to do!
Rich, I agree with you.. it is important for buyers to not assume that sellers are desparate because of the news or anything else.. Buyers should never assume anything, just make their offer based upon what they want to do. You are doing an excellent job of blogging to our clients!
Hi Rich - I am always surprised when listing agents advise their clients to simply reject low offers. I think that most people who make low offers do have more to offer - they are simply testing the waters and will come up if they want the property and if the offer is simply too low for the seller to accept. Always counter rather than reject!
Hi Rich!
This is really well written...and for my part...a de ja vous of the last offer I wrote. I was actually writing it for another agent who was out of town, so I didn't really know them very well. We talked for 20 minutes on the pluses and minus' of a $5000 difference in offering price. I told them that the lower figure would most certainly get a counter. The higher offer was close enough (within $15,0000), that they might, just might, have it accepted as written. It was a slim chance, but they decided to try the higher price. And....they accepted it as written! Boy, did I look smart! However, I don't think this is "smarts". This is knowing, in your gut, where that fine line is, and then getting lucky...because none of us, including the seller, knows what they will accept on any given day!
When my seller's receive a lowball offer, I simply tell them it's the beginning of a negotiation. I've never had a seller flat out reject one.
It's hard to convince the lowball buyer that every seller isn't desperate or even that they have a payoff and may be close to bottom dollar anyway. I have a conversation with the buyer about writing offers and how to have it their way before they make the decision of how much to offer. I have usually already shown them comps, which makes it even easier.
Great series, by the way.
Rule #1 - If you're not willing to walk away from the deal, you're going to lose in the negotiation.
Rule #2 - If you're not willing to walk away from the home, don't negotiate so hard that the seller walks away.
Your ideas are spot on - thanks for sharing!