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We offered 15% below asking--all cash--on a house that had been on the market for a few months in 2008. They said no, they had already dropped the price, and this was firm.
We said okay, we'll find another.
Three days later, there was a big stock market drop. The sellers decided that maybe they could negotiate, and offered 5% off.
We went to their open house that weekend, and decided not to go further. (Neighbor's driveway was right next to the only deck, the kitchen was gorgeous but tiny...)
Months later, I ran into the seller. She remembered me from the open house, but didn't know I'd made an offer. The house had sold weeks later for less than we offered. She complained to me about it!
Meanwhile, we'd gotten a place we liked better, with more land, for less money. Had to redo the kitchen, though.
As a buyer you should know what you're willing to pay and stick to it.
And as a seller, you might need to be nicer to "lowball" offers in a buyers market
General rule is to not go under 90% of asking. Go too low and you'll likely not even get a response.
If a seller is asking too much, just sit tight. If they lower the price, put in an offer. If not, well, not every deal is meant to be.
If a seller is asking too little, I would inquire as to why. It's likely the house has some major issue(foundational, unresolved permit issue, etc) or they are trying for a bidding war.
In the case of the bidding war, I would never go over what I feel the house is worth, regardless of "give your best price" hype. A lot of people get emotionally attached and fall for this simple trick. If a real estate agent recommends going beyond what I feel a house is worth, I would fire them.
Normally though, if a listing agent is pushing for a bidding situation, I will walk away and let the bigger idiot hold the bag. Never underestimate a moron with a preapproval letter in hand with overeager agents pushing for max prices.
General rule is to not go under 90% of asking. Go too low and you'll likely not even get a response.
If a seller is asking too much, just sit tight. If they lower the price, put in an offer. If not, well, not every deal is meant to be.
If a seller is asking too little, I would inquire as to why. It's likely the house has some major issue(foundational, unresolved permit issue, etc) or they are trying for a bidding war.
In the case of the bidding war, I would never go over what I feel the house is worth, regardless of "give your best price" hype. A lot of people get emotionally attached and fall for this simple trick. If a real estate agent recommends going beyond what I feel a house is worth, I would fire them.
Normally though, if a listing agent is pushing for a bidding situation, I will walk away and let the bigger idiot hold the bag. Never underestimate a moron with a preapproval letter in hand with overeager agents pushing for max prices.
And, are you the sort who would fire the agent if they couldn't get you a house when you are outbid multiple times?
Let's say, three years down the road, when we are in a buyer's market.
Is this what your crystal ball shows you? (You may be right, as my crystal ball has a crack.)
I think that the "affordability index" might be similar to today. The price may come down some, but not 50%. This reduction in cost may be offset by the increase in interest rates to borrow $$$. So, all in all, the payment could be close to what it is now. Could even be more...
Really, it was mostly a rhetorical question.
People do that, blame agents for not making their uncompetitive offers into winners.
Last year I ended up letting go of my agent for my home purchase. I placed competitive offers but I felt that on a couple of occasions, she was outmaneuvered by others during the multiple counter offer part of the deal. Alot of it was inadequate communication between my agent and the listing agent.
I then started working directly with the listing agents on subsequent properties i was interesting in, and landed a nice house shortly after. Yes, that agent made double commission in a dual agency role but communication was much easier. I had the MLS comps at my fingertips so I knew the price was fair and they gave me enough time to release contingencies.
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