Buying a home and thinking of making a ‘low ball offer’?
As a real estate professional in the Oklahoma real estate market, I get to deal with all kinds of situations involving 'offers' on the homes I have listed to sell for my home seller clients. Explaining the nature of offers to a home seller, especially if they seem low in offer price to my clients is quite naturally important.
This also applies to my home buyer clients when they decide that regardless of it being a 'sellers market' in our local area, they want to submit an offer on a home. If they REALLY love and want the home, I try to explain that it is not in their best interest to pursue that approach.
Here's a helpful piece of text that I use to assist the home buyer to understand 'low ball' offers:
"I thought I should follow-up with you re: submitting offers to sellers which are substantially below the asking price. I hope you'll hear me out, as I wouldn't be doing my duty as your agent if I didn't at least bring this up. Now, I'll submit any offer you request that I submit, but there are some things you might not realize about the "lowball" offer and how it might actually hurt your home search. For many sellers (even those who you think might be a little desperate to sell), the lowball offer can come across as frivolous, or even insulting. If you're truly interested in the home, bidding so low can actually backfire badly. Insulted sellers are less willing to negotiate and in many cases won't even submit a counter offer. Now, this might not be the end of the line with that seller, but if you do decide to make an offer closer to something the seller is willing to accept, you may find them utterly inflexible when it comes to negotiations. Basically, the lowball experience leaves a bad taste in the mouth, while a reasonable offer opens the door. I mention this with the utmost respect and with your best interests in mind. I represent you and will do so professionally, but it's also my responsibility to share my experience with you when it comes to bidding and negotiations. I'm happy to discuss this further with you and revisit any offers you may be considering before we submit them. Feel free to call me or email me with your thoughts. Thanks for hearing me out."
If you're a real estate agent out there and want to adapt that for your own use, feel free to do so. If you're a home buyer and of a mindset to make low ball offers in a competitive sellers market...take note and heed my advice.