Lowball Offer on House

[w_gibbs]

UPDATE: He countered with this:

$267,500 and he writes me a $10,000 check for closing

He basically restated his $257,500 offer. Wasn't expecting that. Now I wish I had offered $250,000 instead of the $257,500 and 3%. Oh well I think he probably would have countered that at $256,500 or $256,000 at best so it's probably irrelevant. There really isn't anywhere for me to go from here. Maybe I can find out what kind of car he drives and write that into the contract...lol.

Thanks for all the helpful suggestions. I think it didn't work out because the seller was under no pressure to sell. It just wasn't an optimum situation for getting a house way below market value.

[squiffy]

Great posts Gibbs. I hope more people will post their negotiating experiences here with houses, cars, etc. so that we can all learn.

It's important to keep your expectations realistic. Even in a market where prices are dropping, it will be very rare for you to get the deal of the century. By definition, a deal of the century only comes around once in a great while, when the seller is incredibly desperate.

Let's put it this way. If you paid $1 for a Hershey bar yesterday, you'd have to be pretty desperate to sell it for 50 cents or 10 cents today.

If no one offers you close to the dollar you paid, you will probably eat it yourself or wait for a better offer.

If the "genuine" market value of the home, based on comparable sales, is really 257, then it's just plain unrealistic to expect a rational seller to give it away for 230 or 240, unless that seller is incredibly motivated or desperate, due to divorce, illness, job relocation, etc.

But keep trying.

If you make 1,000 offers on a 1,000 homes, or 10,000 offers on 10,000 homes, then statistically speaking, you may eventually find that one desperate seller in 100 or 1 desperate seller in a thousand.

But don't expect that prize salmon or bass to leap into your fishing boat.

[squiffy]

If you are interested in getting a great bargain, you may wish to try focusing some effort on looking at bank owned properties.

Here in Fresno, so many homes are going into foreclosure that you can actually find some nice homes in good neighborhoods that haven't sold and have gone back to the bank.

The bank should be a relatively motivated seller. So, as long as you find no major defects, you might pick up a good deal. Just something to consider.

[AMerv]

When dealing with sellers that "don't need the money" so to speak, ask them if they would like to carry the note. They can at least make their bottom line. Your paying interest regardless, so it doesn't matter who gets it.