Savannah Ga Real Estate: The problem with low-ball offers

Negotiating home price can be tricky. Many people think that going in with a very low offer is the best way to get a good deal. The idea is that they can start from a low number and this will make the counter-offer lower. The buyer gets it into his/her head that their offer is a real starting point and begin rationalizing by listing all the repairs that need to be done. Some buyers state that the home is overpriced but can’t tell you what houses are selling for in the area. I understand wanting to get the lowest price possible – that is what a buyer should strive for. However, sometimes bidding too low can have adverse effects and prevent the buyer from getting the lowest price.

A too low offer can anger a seller to the point they will not negotiate. Especially in a strong market - the seller knows what other houses have sold for and how long they were on the market. The seller looks at the too low offer and after yelling “&8^%%%#@^”, tears up the offer and says “No way!” This may be okay if the buyer wasn’t too keen on getting the house in the first place, but if the buyer really wants the house, they may have blown any chance of getting it, at least getting it at a lower price. They may present another offer that is closer to the sales price, but if the seller is still offended or thinks the buyers aren't serious players, he/she may counter at a higher price than if the original offer had been higher, or just stick with full price. Avoiding a stand-off is advised.

It is important when making an offer to know the length of time on the market, what comparable houses are selling for, and what appreciation-trend is a reality in that particular market. It can also matter what time of the year it is, whether it’s during a selling-time or buying-time. Spring and summer are usually better for the seller, fall and winter for the buyer, although this is not always true for any particular home. Some sellers are not in a hurry to sell and will hold out rather than take far less than what they want.

The irony in all this is that a well-researched, realistic offer can oftentimes render the buyer a better sales price than an offer that is unrealistically low. Many times a seller will get an offer somewhat lower than they intended to take, but close enough for them to take it. The seller may take it because it is close enough and they are ready to sell the home and move on, especially if the offer is clean without special stipulations that ask for everything from painting allowances to including a lawn mower and a years supply of Reese’s Cups. It also helps if the buyer’s financing is solidly in place with no potential problems.