Showing posts with label Lowball. Show all posts
Showing posts with label Lowball. Show all posts

Thursday, July 27, 2017

Submitting a Lowball Offer

Submitting a Lowball Offer

You are working with a great Real Estate Representative; they have been sending you all of the listings that fit your criteria for the area you would like to live in. Some things they make sure of are that each home is within your budget, has the right amount of bedrooms, is in the school district you want, the backyard is a good size, and the basement is finished. But, you still haven't found the perfect home yet!


The weekend comes and you happen to be driving through the area you would like to move into and see an Open House, so you innocently go in to check it out.


The moment you walk in the house you are in love! It has the dark hardwood floors you imagined, the crisp, updated kitchen you've been dreaming of, a Jacuzzi tub in the en-suite bathroom that you get to by walking through the gigantic walk-in closet with double doors! Your heart is beating like a crazy, you feel like a hunter when they zero in on their prey!


After spending an eternity in the home, asking the listing representative a ton of questions, you finally leave, close your car door and call YOUR Real Estate representative. You swoon about how amazing this house is and go in to great detail about all of its glorious features. As you do this, your representative pulls the home up on the MLS to see that it is substantially over your budget. Your representative breaks the news to you, but you inform them that you know how much it is and would like to submit an offer that suits your price range (about 15% less than the asking price)...whoa - stop - put the breaks on, your Real Estate representatives eyes just popped out of their head!


Don't get me wrong, there can be valid reasons to submit a lowball offer (as this is referred to in the industry), the situation I just described is not necessarily one of them, although it is the one that seems to happen more often than not.


The best reason for a lowball offer is that the home is in fact over-priced compared to other similar homes in the area. Another fairly good reason is that there was an adjustment in the market and the home has now been sitting with no offers for weeks as it became over-priced when the market changed.


Here are some things you should do if submitting a lowball offer:


- Write a clean offer, as perfect as possible


- Shorten inspection periods and mortgage times


- Include a good deposit (at least 2-5%) to show that you are serious about your offer and this home


- Do your homework, have your comparables with notes about each one prepared to prove your position on price


- Call the Listing Real Estate Representative ahead of time to find out all you can about any offers that may have been or are currently on the table as well as what the sellers motivations are behind selling


- If your lowball is countered, don't get discouraged - you started the tennis match that you are playing and the ball is now in your court - don't stop hitting the ball until it is out of bounds!


- If your offer is flat-out refused, no worries. Just wait it out, either something else will come up for you, or this home will still be sitting on the market weeks later. Go back with your original offer (just cross out the dates and update it) so the seller can see how long its been since you presented this to them. They may be much more open to working with you now.


If you are planning on making a lowball - do your homework, understand what is happening in that market and be prepared to play a game of tennis! Good luck!



Amanda Ross focuses on the Real Estate market in Oakville, Ontario and surrounding areas (Burlington, Hamilton, Milton, Mississauga). Check out my website today for more tips, news, and information on the exciting world of Real Estate, http://www.amandaross.ca Get your free computer-generated Comparative Market Analysis for your home by visiting my website (http://www.amandaross.ca) and clicking on "FREE CMA" now!