The market for the past few years has been on the buyers’ sides, so it isn’t surprising to have seen some lowball offers.
Recently, the market has been changing in places, and a lowball offer may affect a buyer in ways they had not thought of before. Trulia wrote a post about five facts to consider, and they are good ones. Here is my take on those five things to consider.
1) Understand the Market Temperature. What does this mean? Well, if the market is on a downturn, then a lower offer may not be unreasonable, because the market is showing that it is declining. If list prices are up, as are contract prices, take note. You can be sure the seller has been watching what is happening around them!
2) Use Comparable Homes to Decide on Offer Price. Is there a home that looks similar? What did that home have? The kitchen was original? The basement unfinished? If the home you are considering has granite counters, beautiful cabinets, hardwood floors, and a finished basement, then that house should be worth more than the one that needs all of that work done.
3) Time. How long has the house been on the market? How long has the buyer been looking? If the house has not been on the market for a long period of time, the seller may feel that their asking price is right.
4) Sellers are Human. What if the seller feels their house is priced correctly for the market, and a buyer offers a very low price? How do you think the seller would feel? Unhappy? Offended? Very possibly. If a buyer truly feels the house is worth much less than the seller’s asking price, then they should demonstrate why.
5) The Buyer May Never Get The House. If a seller feels slighted or offended, keep in mind #4 — sellers are human. Might that offense mean the seller won’t work with that buyer? Possibly. And they may sell to someone else who offers more up front, even if they negotiate to where you would have come up to.
Sellers don’t have to counteroffer. They can reject an offer outright.
A buyer should understand the market and what is happening, and a buyer’s agent can help guide them through the process by sharing facts and statistics.
For more information on a specific area of Baltimore real estate, please contact me. I would be happy to help!
*Please note, if you are under contract or working with another agent, I cannot be involved in that situation! Thank you!*