What happens when the offer is deliberately much lower than what the owner is asking? Here are some thoughts from both the buyer’s and seller’s perspective.
BUYER’S PERSPECTIVE
The buyer who makes a low offer may do so for a number of reasons. Perhaps the property will require a substantial investment to make needed repairs. A low offer would permit the buyer to retain some funds to pay for these improvements. Or, the offering price may be all the buyer can afford. It is not unusual for the buyers to fall in love with a property out of their price range. Another motive could be that the local real estate market is slow and the buyer is just testing a number of sellers to see who may be desperate enough to accept a low selling price.
SELLER’S PERSPECTIVE
When the seller receives a low offer, he or she may experience a variety of emotions from disappointment to outrage. Although an emotional reaction is understandable, a wise seller will step back from his or her feelings to examine the situation more closely. What are the reasons for an offer in this amount? As we know, there are a number of possible motives that might prompt a buyer to offer much less than the asking price. Is the asking price proper? Is the buyer seriously interested in this home or just on a fishing expedition?
REALTOR’S PERSPECTIVE
Whether representing the buyer or the seller, the Realtor is in a tough position when a low offer is presented. The buyer runs the risk of losing the attention of their Realtor. A good agent, one that you would want to represent you has many clients, and it is very possible that your Realtor may not take you seriously if you are not realistic. As for the seller’s agent, a good Realtor will do their best to keep the seller calm and remind them that it is not where we start, but where we end up. Some deals take a little longer and require grace and patience.
ADVICE: If you are a buyer, understand that low offers can upset the seller to such a degree that further negotiations may be jeopardized by a seller who seriously questions your motives. If you are the seller, take a deep breath, listen to your agent and follow their lead. If you are the Realtor for either party, “Patience Grasshopper”…
