A Strategy For Success
If you are seriously interested in a particular home, making a low bid is a calculated risk.
If your bid is too low, the homeowner may be insulted and choose not to negotiate with you, (even if you come back later with an improved offer). Often homeowners consider buyers who make insultingly low offers to be either trouble-makers or unqualified smart alecs.
Submitting a low offer, without a strategy, could cause you to lose credibility with the homeowner permanently.
So is it worth it?
If you really want the house, should you run the risk of making a low offer?
In a strong market (a seller’s market)… probably not.
In a soft market (a buyer’s market), however, many homeowners are willing to consider "any and all offers". And low offers, if presented correctly, just might have a good chance of being successful.
IMPORTANT: In order for a low offer to have any chance of success, you must provide the homeowner with a way to move off his list price with dignity. Your goal is to challenge the list price without damaging the homeowner’s pride. The proper use of diplomacy, courtesy and respect will enable the homeowner to save face while simultaneously conceding on his list price. (Remember: A true diplomat is someone who can tell people to go to hell in a way that makes them look forward to the trip.) Include diplomacy, courtesy and respect in your plan and you will be rewarded.
How to make a challenging, but diplomatic, offer that a homeowner might consider:
Research recent home sale prices in the neighborhood. Know the status of the current real estate market. In addition, know the answers to the following basic questions. How long has the home been on the market? Have there been any price adjustments? When was the last price change? Have there been any offers? Why is the owner moving? Is the house occupied or vacant? If the home is vacant, how long ago did the owner move? If it is not vacant, when would the owner like to move?
NOTE: Many homeowners have raised their families in the house. They have many fond memories associated with the home and would love to turn it over to a nice young family who might enjoy the home as much as they did. Most homeowners would prefer to sell their homes to someone they like. Do your best to be likeable.
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© Copyright 2007 Bill Boeckelman Publications