Indian culture and negotiations (appraisal, agent, mortgage, mortgage)
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Without sounding too culturally insensitive, can anyone help me understand how to approach real estate negotiations with an Indian buyer.
We are selling our house, it is priced competitively and we are in a desirable part of a brisk market. The house is unique so it's not for the average buyer (big and has lower level that could be second living quarters). We've had some offers that for one reason or another didn't work out. We don't have to move so we are pretty firm on price and have turned down other low-ball offers.
The most recent is a low-ball offer from an Indian buyer. At first we declined to counter b/c the offer was so low. Their agent basically begged our agent for a counter, so we did. They have come back with another offer only a few thousand more than before. We know they are pre-approved for our asking price and have another $200K to put down.
Spouse & I are frustrated. We don't have a problem negotiating in good faith, but get the impression that the normal ways of negotiation may not work in this situation. Any suggestions on how to handle this would be appreciated. Our realtor is kind of useless on this one.
Oh, I have a relative who is Indian and apparently, our house ticks all the right boxes given the industrial kitchen and ventilation for cooking, the orientation of the house, a front formal room and space for multi-generational living. We are also in the best school district in the area and even at our asking price, we are a bargain compared to other houses our size and in our district.
Since all the other offers were low ball offers, sounds like they are just like every other buyer regardless of ethnicity and they think the house is overpriced so they are offering what they think its worth. Why would their low ball offer be anything different from all the other low ball offers and why do you think you need to negotiate any different from all others?
"Thank you for the response.
We very much appreciate your interest and look forward to working with you.
Terms X,Y, and Z are great. Let's get the sales price right so we can move ahead.
Our price of $ABC,DEF is a good value in the market, supported by several comparable recent closed sales.
With your agreement, we can go to contract and get you into your new home."
Here's a funny thing about Indians: They are people, just like the rest of us. Negotiate like you are negotiating with people.
Minor cultural differences do not change your home value in the market, and if you are truly presenting at market value for your property, you will get your price.
You're dealing with a tough negotiator. That it's a South Asian stereotype is irrelevant as there are tough negotiators from all backgrounds. If you think your house is worth list then wait for someone to pay list. If they think it's worth list they'll eventually get there; if they're looking for a bargain they may not. If they're in no hurry to buy then they would be irrational to pay any more than what the second highest bidder would pay, especially if you are in a hurry to sell.
Also, don't mistake the negotiation for some collaborative feel-good exposition on why your price is the right price.
Their real estate agent should be explaining the customs in the US.
Since they have not understood after a first go-around I would not play the game; come back with nearly the same or the identical price you gave last time.
If every offer you've received is a low-ball. You're overpriced. Who cares what you want for the house, the buyers are telling you what they would pay, and it's not your price.
You said they came up "only a few thousand more..." A "few" thousand? Sounds like they came up a lot. That's a good start. If they only came up a couple thousand, you might not have anywhere to go, but a few is a good move on their part. Now you need to make a good faith jump in price on your part to get them closer to where they'll meet.
And just think of all the mortgage payments you will continue to pay as you sit and wait for another buyer to low-ball you again. You should work with what you have.
Indian and Asian cultures are haggling cultures. We aren't used to that in the US. I just tell my clients we will have a lot of counter offers. If you are firm on price then keep countering back at that.
I also agree with Falconhead that if all the offers you are getting a low-ball, then the market might be talking to you, and you might not be listening.
Since all the other offers were low ball offers, sounds like they are just like every other buyer regardless of ethnicity and they think the house is overpriced so they are offering what they think its worth. Why would their low ball offer be anything different from all the other low ball offers and why do you think you need to negotiate any different from all others?
I agree that they sound like typical buyers and being Indian doesn't really have anything to do with it.
Just handle it as you would ANY offer.
Also, are you SURE they are lowball offers, or are they accurate for your "unique" house?
"Thank you for the response.
We very much appreciate your interest and look forward to working with you.
Terms X,Y, and Z are great. Let's get the sales price right so we can move ahead.
Our price of $ABC,DEF is a good value in the market, supported by several comparable recent closed sales.
With your agreement, we can go to contract and get you into your new home."
Here's a funny thing about Indians: They are people, just like the rest of us. Negotiate like you are negotiating with people.
Minor cultural differences do not change your home value in the market, and if you are truly presenting at market value for your property, you will get your price.
+1. As an Indian lady myself, it sounds like your home is overpriced, since other buyers' deals fell through. It can be difficult to sell your home because sellers often believe their home is worth more than it is. There are all sorts of emotions in your house: tons of stress involved with the sale itself, a lot of memories, such as marriage, raising kids, jobs, difficult times, and other things. Your house is worth what the appraisal comps say it is: nothing more. The fact that your house is unique can work against you. That means it's likely fewer buyers will be interested in it. Try to think of your home more objectively, from the buyer's perspective. Although it can be difficult, it may help you understand why a buyer will put in a low offer or wants changes on the deal prior to closing. Good luck!
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