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Old 04-08-2008, 02:19 PM
 
Location: Between a Rock and a Hard Place
110 posts, read 470,552 times
Reputation: 68

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Again I just wanted to take the time to share and solicit the help for strategies on making offers and dealing with Sellers in this market. Most of what I've learn is here from City Data and our recent experiences.

1. Making the Offer - Work with your Realtor and be apart of the process. All nearby transactions/listings are fair. If everyone shared in the GOOD isn't it the same for the BAD. Yes.
- Active Sales
- Pending Sales
- REO's – Look in my other thread for a list of resources.
- Short Sales
- Previous Sales
- Your means

2. Make sure you are PREAPRROVED
- Cash buyers are king but in the end sellers are getting cash anyway. Shakey credit or little down payment? Use one of the local programs in your area or one of the national ones like NACA or ACORN. Well qualified buyers who qualify would be smart to get into these programs. Why? For all they make you go through they are becoming more of a secure loan than the increasingly rising standards of conventional loans and some programs offer better than prime interest.

3. Things you MUST ask for in this market
- Closing Assistance
- Wearable Item Replacement Allowance (Carpet, Paint and/or Appliances)
- Home Warranty for 1 year.

4. After the inspection get the money for all necessary repairs from the seller and coordinate the repairs to be contracted by you after closing.
- Repairs not done or half done wont stop closing.

5. Ask for something you dont want. Something to divert attention away from the listing price.
- Like the Dining room set? Maybe they like it too much and say.. hell NO but we'll accept your price. This is called diversion. Politicians use it with success all the time.
- A freind was recently offended because in post inspection negotiations the Seller took back a TV that was offered in the initial listing after giving into repair conssesions. What is a used flatscreen worth? $500 at best. Here my freind wanted something they didn't need. Feelings killed what I thought was a very good deal

6. Offers.
- Do a lookup of the last transaction price!!!! Find your city, county or state website that gives you this info with GOOGLE. Call the local courthouse if you can't find it. If the person is selling short BE SURE they have been APPROVED to do so!!!! If they are not approved you may be wasting time.
- The longer on the market generally you have a better chance of getting an acceptance of your first low offer.

7. Counter Offers
- Always counter a counter offer! It’s an invitation to do such!! In this market no one expects that a buyer will not counter. This is where #5 comes in. Give up the stuff you didn't want in the first place even if they offered it.

8. Sellers/Investors(trying to get out) - Know your Seller. Research them.. The best way is directly. If they are at showings one of you need to be the talker and the other one REALLY checking out the house. You know Good Cop/Bad Cop!

- Seller #0 - Sellers trying to sell short who are unapproved. You can potentially waste alot of time here. Many of these sellers never get the chance to sell.

- Seller #1 - Bought pre-boom, has plenty of equity even in today’s Market. Has no motivation to sell and will resist the reality of today’s prices.

- Seller #2 - Bought Pre boom, has plenty of equity but wants to start shopping and taking advantage of this market. However they do not want to sell there houses in todays market prices.

- Seller #3 - Approved Short Sale. You ever notice how these listings are lower than what they paid but still high? Low Balling these guys can be tricky since the bank is already at a lost. Your realtor should take point on this one. Property can either sell in a short sale or foreclose.

- Seller #4 - Bought Pre boom, has plenty of equity but has a contract on another home OR needs to relocate soon. Eagar to move but their equity from the sale will effect what they pay on their next home. This seller will try to resist today’s prices less than Seller #2. Must eventually sell or rent out.

- Seller #5 - Paying on this property and a recent purchase. Could also be a couple consolidating into one house. They are like Seller #2 until the payments wear them down. Must eventually sell or rent out.

9. Rejections - Be mentally prepared for this! Watch the market around your rejections.. 30 days later.. dust yourself off and try your LAST offer or LESS.

Any constructive input is musch appreciated.
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Old 04-08-2008, 04:37 PM
 
Location: Columbia, SC
9,291 posts, read 18,372,811 times
Reputation: 7055
Much better. That's a pretty solid list.
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Old 04-09-2008, 08:21 AM
 
Location: Dallas, NC
1,703 posts, read 3,551,226 times
Reputation: 808
It's a good list but as a seller, I'm getting sick of seeing everyone say make lowball offers, they'll fall for it. I want to sell my house but not enough to go in the hole. I'm aware of what prices are but I'm still not going to cave to a lowball offer b/c someone is cheap and wants something for nothing.
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Old 04-09-2008, 08:43 AM
 
Location: Raleigh, NC
9,043 posts, read 11,706,992 times
Reputation: 1394
Quote:
Originally Posted by austinsmom View Post
It's a good list but as a seller, I'm getting sick of seeing everyone say make lowball offers, they'll fall for it. I want to sell my house but not enough to go in the hole. I'm aware of what prices are but I'm still not going to cave to a lowball offer b/c someone is cheap and wants something for nothing.
I doubt many say to intentionally make a lowball offer. Your interpretation of a lowball might not be someone else's. Due to the correction, many who purchased recently will lose money on the deal.

Sorry, that's just the way it is. No one is entitled to make a profit, regardless of whether they own stocks, bonds, or even a home.
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Old 04-09-2008, 08:50 AM
 
Location: Prospect, KY
5,284 posts, read 18,145,526 times
Reputation: 6558
Great list - thanks very much!
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Old 04-09-2008, 10:21 AM
 
Location: Dallas, NC
1,703 posts, read 3,551,226 times
Reputation: 808
Quote:
Originally Posted by austinsmom View Post
It's a good list but as a seller, I'm getting sick of seeing everyone say make lowball offers, they'll fall for it. I want to sell my house but not enough to go in the hole. I'm aware of what prices are but I'm still not going to cave to a lowball offer b/c someone is cheap and wants something for nothing.
I'm not trying to make a profit...I'm trying to not have to go into my pocket too far to pay the realtor fees and closing costs! Big difference.
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Old 04-09-2008, 12:24 PM
 
16,437 posts, read 19,411,448 times
Reputation: 9544
Quote:
Originally Posted by austinsmom View Post
I'm not trying to make a profit...I'm trying to not have to go into my pocket too far to pay the realtor fees and closing costs! Big difference.
You can afford to hold. Many can't. If someone balks at my "lowball" (grounded in reality) offer, I just move on to one of the other millions of houses for sale.
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Old 04-09-2008, 12:51 PM
 
Location: Between a Rock and a Hard Place
110 posts, read 470,552 times
Reputation: 68
Buyers: Buy for the lowest price.
Sellers: Sell for the highest price.
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Old 04-09-2008, 12:53 PM
 
4,409 posts, read 6,192,577 times
Reputation: 10755
And this is why as sellers we're pulling our house off the market.
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Old 04-09-2008, 12:58 PM
 
432 posts, read 1,732,496 times
Reputation: 135
Here are some really dumb things I have seen prospective buyers do. These make sellers NOT want to deal with you, especially under contract:

1. Immediately ask the FSBO owner (right now that is me) "give me your lowest price", "How low will you go", "What will you take". For crying out loud, write up the offer and get serious. Then we can negotiate.

2. At the open house or showing, pick at the wall to wall carpeting to see if hardwood is REALLY under there. And then go to the basement and poke at the dropped ceiling tiles. Obviously they're hiding something.

3. Be sure to scoff when they tell you to stop that, and your concerns can be answered with disclosures and an inspection.

4. Tell the homeowner you feel sorry for them and you are willing to give them (insert your insultingly low figure here). Do this at the open house in front of others and you get bonus doofus points. When dealing with older sellers who have nearly 100%equity, tell them you KNOW it's all gravy, huge profit. Never mind that this is their nest egg, and they have to find somewhere else to live at todays prices, not yesterdays.

5. When the homeowner tells you to take your ridiculous and ignorant offer out of their house, stand your ground and just keep negotiating, and arguing. In front of other people.

6. Don't tell the homeowner you are working with a realtor, even though the open house flyers say "realtors welcome". Because maybe you think you will get a deal or something. And insist on never signing in! Why desperate sellers just love opening their doors to strangers who can't even give their name.

7. Bring your dog to the open house. When the homeowner tells you that you cannot bring the dog in because of cats, act very surprised and say "what? You don't like dogs? But he likes cats. Really". Oh yeah? Well, you haven't met Catzilla. And your dog isn't going to. Really.

8. If you're REALLY sharp, impress the homeowner by using their full legal name and tell them you looked up what the house is REALLY worth on the tax records.

9. Tell a homeowner in northern NJ you'd like to do this without lawyers.

10. Let your kid run all over the place. Be sure your kid gets a chance to meet Catzilla.


Now, in all seriousness....

Open house #2 is this weekend. We've had over 20 showings this week. This is in an area where there is strong competition. Never do an open house alone. Always have someone else with you, and group the people if you have a crowd. Don't be too chatty. Show the house to your best advantage, answer questions when asked. I was a realtor for several years prior to my cancer treatments (I'm ok now) - the seller in me wants people to know all about how we lived in this house, the realtor side of my brain is shouting "JUST SHUT UP AND LET ME HANDLE THIS!!!"

Put away all your really good small stuff. And make sure your locks and alarms work. You don't want people coming back uninvited for a second "view".
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