Tuesday, March 15, 2011

How Disappointed Will You Be If You Lose This House?

No one will sell you a house for less than what you offer, right? So why not start very, very low with the first offer?

Sometimes it works. I’ve had very low offers accepted without a single counter. Almost always it’s because the house has been on the market for a while and the seller is simply sick and tired of the process.

More often, it doesn’t work. My most notable transaction was when the seller was so insulted that she refused to sell to the buyer even after he came back with a full price offer. She still owns that property.

More than once, I’ve seen a second and better offer come in and so the low bidder never gets an opportunity improve their offering.

Most often the low ball offer will be met with a counter. And depending on how reasonable the counter is, I can often predict the outcome. Most people get a bit of a thrill with the start of the negotiation process but they quickly tire of the drama. If counter offers bounce back and forth 3 or more times (unless it’s very minor tweaking of the terms) most often the offer is going nowhere.

So, before you sit down to right a very low offer, ask yourself how disappointed will you be if you lose the property. Only your gut will tell you how to proceed.
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