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Our house had it's first offer placed on it last Thursday night. Our house has been hard to sell. Its a small house, athough totally redone, and our market tends to sell family sized houses, not houses meant for 1-2 people. Our house was priced $20K under appraised value, to match the market as best we could according to our realtors advice. The offer was 12K below that. The buyer wanted to pay in cash. I talked to my realtor, and told him we REALLY didn't want to lose this buyer, however, I would take his advice and counter or think about accepting. Since it was the first offer, my realtor felt we should counter to try to get the buyer just a little higher, as our realtor felt it was a low ball offer. The buyer wanted us to be ready to move out on Aug. 16th, so we offered to be ready by Aug. 9th, and met him over half way between his price and ours. We agreed to all other terms.
Got a call a few hours before our counter expired, the buyer decided to look at a house that is "just coming on the market on Monday" before he moves forward with us.
We are beyond sad we didn't take that first offer. We are waiting to see if we get any call back/interest from this buyer. Our realtor is pretty upset, and says this isn't how this normally goes. We are wondering if this buyer will submit another offer today that is lower than his first.
What has your experience been? Have you taken first offers before?
I took the first close to reasonable offer that I got the last 2 times I sold. The last one, I had an early offer rom a RE agent that was about 20% lower than asking, which was reduced already. I ignored it. The next offer was about 10% lower than original asking and I took it.
The time before that, I got one offer and had to carry the note myself. Turned out to be a good deal as it was front-end loaded with interest and they sold 4 years later - I got almost all the principal at that point.
Even if you did take his first offer, he may have seen something on the market. This happened to us several times. It is out of your control. Hopefully he will come back, like yours better. IMO he would have just countered back, not giving you that information.
At what percentage below asking? (At $150,000 asking... $12k is 8%)
That almost always means an investor type or at least someone with choices.
Hi MrRational. Our house was priced at $99,900. Offer was $87,000.00 so about 12% under. Should that mean if he comes back with the same offer we should consider it to be pretty fair?
You said that the house was priced $20K under 'Appraisal', yet, this was your first offer. How do you know what the 'appraised value' of the house is; -- did you pay for a current appraisal? Since this is a smaller home than others in the area, an appraisal on a similar larger home is probably irrelevant (as is a calculated price per sq. ft price). Also, some realtors simply tell sellers they can sell their house for whatever they think it is worth ... to get the listing. (BTW, every house on the market eventually gets a 'first offer' - Relax, at least you have an offer; there will be others).
You say that the house is "difficult to sell" (Has it been on the market longer than other sold homes in your area ... or simply 'longer than you expected?') Some houses can be 'difficult to sell,' due to small or peculiar layouts, decor, location problems ... or lazy realtors. More often, 'tough sell houses are overpriced by sellers based on emotional factors: How much they paid for the house; How much they 'like' the house; How much money they 'need' to make on the house to (fill in the blank); etc.. Sellers of overpriced houses remain confused and uncertain about offers and negotiations, because they really don't have a sound basis for what the house is worth. (Whether $30-35K is a lot of money to 'give away' depends on the actual value/price of the house ($200K (15%) or $500K (6%).
True, one cannot sell a house for more than 'anyone' is willing to pay for it ... and there are times when a 'distress sale' is necessary. But, if a seller does their homework, just as a determined buyer will, both will have a pretty clear idea of what the house is actually worth in the current market.
It used to be that the first offer is the best offer. And it proved to be true. But now it's all over the place.
Have you marketed actively to the families that might want a place for the grandparents? Perhaps the grandparents even just visit and want a separate small home when they visit, not to live in year round yet.
So the prospective buyer was looking at a house coming on the market Monday. Is that today?
I wonder if your realtor knows which house it might be.
Yes, sounds like an investor. Not too emotionally committed.
Consider also..he's not asking you pay his closing costs or anything additional?
Our house was priced at $99,900.
Offer was $87,000.00 so about 12% under.
Should that mean if he comes back...
He isn't coming back any higher. That ship has sailed.
From the standpoint of an investor looking for a rental property in a nice(r) area
the $87,000 is probably close to what they see as correct.
The question remains whether that $99,000 "market price"number is actually valid
for a regular buyer and if you can find a "regular buyer" who wants a small home.
Keep looking for them.
Yep. I've received low offers and took them, without countering. Good thing too, on one house the market took a dive 6 months later. I could have easily sat on that house for another year or more if I didn't take that offer. Depends on the amount and the market outlook. I'd rather sell a $110k house for $100,000 today, than $92k a year from now.
You're taking a gamble if you counter. Gamble wisely.
Last edited by 399083453; 07-22-2013 at 12:54 PM..
Our house had it's first offer placed on it last Thursday night. Our house has been hard to sell. Its a small house, athough totally redone, and our market tends to sell family sized houses, not houses meant for 1-2 people. Our house was priced $20K under appraised value, to match the market as best we could according to our realtors advice. The offer was 12K below that. The buyer wanted to pay in cash. I talked to my realtor, and told him we REALLY didn't want to lose this buyer, however, I would take his advice and counter or think about accepting. Since it was the first offer, my realtor felt we should counter to try to get the buyer just a little higher, as our realtor felt it was a low ball offer. The buyer wanted us to be ready to move out on Aug. 16th, so we offered to be ready by Aug. 9th, and met him over half way between his price and ours. We agreed to all other terms.
Got a call a few hours before our counter expired, the buyer decided to look at a house that is "just coming on the market on Monday" before he moves forward with us.
We are beyond sad we didn't take that first offer. We are waiting to see if we get any call back/interest from this buyer. Our realtor is pretty upset, and says this isn't how this normally goes. We are wondering if this buyer will submit another offer today that is lower than his first.
What has your experience been? Have you taken first offers before?
If this was a regular buyer I would say your realtor would be right in countering however with it being a cash offer cashbuyers rule the roost, they have all options available to them unlike those needing mortgages. As long as you were okaywith the price the realtor should have advised you to accept. A cash buyer is basically going to call the shots. I lost out on a number of short sales to cash buyers even when I was say 30k-40k over their offer. People like cash.
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