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I just received my first offer, 19,900.00 less than asking...
What percentage of asking does that $19,900 represent?
(iow... 19:150 is different than 19:400)
Everything else in your post presumes that your "asking price" and negotiation budget
represent fair market value for YOUR market. If so, then sure... hold on for a better offer.
I just received my first offer, 19,900.00 less than asking PLUS they wanted an additional 3k toward closing. Total would be 22,900.00 off my price. I allowed 4,900.00 to negotiate with. I knocked off 1900.00 from my price and gave them the 3k they asked for in my counter.
They countered with an increase of 2k and still wanted the 3k as well. I'm not gonna play these games. If they couldn't afford the house they have no business even offering such a low ball offer. I gave my agent my original counter and decided I wasn't going to get involved in games. I had a showing the same day, and now with school out and summer approaching, I feel confident I will sell and negotiate what the buyer and I are "happy" with. My agent called today and said the low-ballers dropped out. Why was I not surprised?
You really need to try and remove emotions out of this. Treat this purely as a business transaction.
The rule of thumb in this market is: 76.234123456% of asking + 3 cents per property sqft (subtract 1.125 cents if the house faces SouthSouthEast or the back of the property slopes more then 6.475 degrees) + the lesser of # of blades of grass OR 1.02589xHeatedLivingArea + the average wind speed at the closest airport + the number of cars that pass the house in a calendar year + the average rainfall over the past century in the county... you then multiply this number by .865429839 if it's the 2nd Tuesday of the month or 1.000456579 on a Friday. Unfortunately, moon phase is becoming a bit more prevalent these days, so you'll want to be prepared to offer 2.76543543 cents less per sqft if we're in a waxing crescent phase. Full moon means you offer exactly 50% of these calculations.
The rule of thumb in this market is: 76.234123456% of asking + 3 cents per property sqft (subtract 1.125 cents if the house faces SouthSouthEast or the back of the property slopes more then 6.475 degrees) + the lesser of # of blades of grass OR 1.02589xHeatedLivingArea + the average wind speed at the closest airport + the number of cars that pass the house in a calendar year + the average rainfall over the past century in the county... you then multiply this number by .865429839 if it's the 2nd Tuesday of the month or 1.000456579 on a Friday. Unfortunately, moon phase is becoming a bit more prevalent these days, so you'll want to be prepared to offer 2.76543543 cents less per sqft if we're in a waxing crescent phase. Full moon means you offer exactly 50% of these calculations.
Projected margin of error with this strategy?
Zero?
I just received my first offer, 19,900.00 less than asking PLUS they wanted an additional 3k toward closing. Total would be 22,900.00 off my price. I allowed 4,900.00 to negotiate with. I knocked off 1900.00 from my price and gave them the 3k they asked for in my counter.
They countered with an increase of 2k and still wanted the 3k as well. I'm not gonna play these games. If they couldn't afford the house they have no business even offering such a low ball offer. I gave my agent my original counter and decided I wasn't going to get involved in games. I had a showing the same day, and now with school out and summer approaching, I feel confident I will sell and negotiate what the buyer and I are "happy" with. My agent called today and said the low-ballers dropped out. Why was I not surprised?
All I can tell you is, it happens. My husband and I had something similar happen not long ago We had a couple contact us directly (although our house is listed with a Realtor and they're working with one) because they figured we could be more flexible on price if we weren't paying any agents. They'd be right, too, if we didn't have a written agreement... too bad reality gets in the way. We hired one of the best agents in our market with an excellent sales history. We used the exact listing price he suggested based on comps in the area. They offered us 20% below our asking price. I told them thanks but no thanks.
It's hard not to feel insulted because we all have some emotional attachment to our houses. But, at the same time, this couple is obviously just trying to get a bargain and I can't really blame them. If we were already in short sale territory or were desperate to sell for some logistical reason, maybe we would have considered the low-ball offer and brought it to our bank. That's not our situation though.
I was a little ticked off by the offer we got because this couple was from out of town and obviously knew nothing about the local market. My guess is that they're still looking and tossing out low-ball offers on houses that they like just to see if any of them will stick. In this market, they'll probably get lucky eventually, too.
Rule of thumb in our market today...make a quick offer with good terms at market price or the other 4 offers will be better and you won't get the house.
I just received my first offer, 19,900.00 less than asking PLUS they wanted an additional 3k toward closing. Total would be 22,900.00 off my price. I allowed 4,900.00 to negotiate with. I knocked off 1900.00 from my price and gave them the 3k they asked for in my counter.
They countered with an increase of 2k and still wanted the 3k as well. I'm not gonna play these games. If they couldn't afford the house they have no business even offering such a low ball offer. I gave my agent my original counter and decided I wasn't going to get involved in games. I had a showing the same day, and now with school out and summer approaching, I feel confident I will sell and negotiate what the buyer and I are "happy" with. My agent called today and said the low-ballers dropped out. Why was I not surprised?
I think you are taking it a little too personally. What is your asking? is $19k like 30 pct off asking or just 10 pct?
I know in our market things are kind of slow so we felt confident offering 8-10% below asking on a few houses. We were looking at homes between $300-350, most of the offers were for houses in the $330-340 range. We'd typicall start in low $300s.
Some folks were like you and hardly budged, and thats fine, its your right. But we found one family who understood the market, and we ended with a good compromise in the middle for both sides.
I guess it depends on what the asking price is. One house we looked at and put a lowball offer on was listed for the same price the owners paid in 2008. Other than finishing the basement, they had done nothing of value to the home and in fact the home showed a lot of wear and tear.
We offered ~20% less (which is the approximate home decline from 2008 to 2012 in our area, they said no, we walked away.
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