Low Ball offers in a HOT market
Let’s talk for a minute about low ball offers in a hot market, so I changed my topic yesterday and swapped it out with this one because I thought this was real. We experienced this yesterday. OK, so we have a listing. Kim has a listing in for a CEO and. Let’s understand something interesting, though, there are seventy thousand households in Frisco. In available homes between zero and four hundred thousand, you want to know how many are available? Seventy seven. That’s almost like a zero. Percent months of inventory that we have that we’re carrying here, there’s no inventory in this price point. So yesterday we got an offer.
The house is listed for three 16 or three, 15, I’m sorry, and we received an offer for 250 for and I asked him, could I please respond to this offer? And she said, sure. So.
Nothing. This is so frustrating when you get this in this situation, and I wanted to call and say, what are what are you doing?
A lot of things went through my mind, actually. But you know what? I thought I sat back and I thought, you know what? You need to practice what you preach, Shawna, and you need to remove your emotions from this. This is business. So you have to think business, remove your emotions. And that’s also something that it reminded me that we’re going to have to discuss with our sellers, not when this happens, but back when we get when we’re having our listing agreement discussions, you know, at the listing appointment is when you should kind of prepare them for what’s going to happen or what could happen. So remove their emotions and think about it in a business sense, so we all want to try and we would not be doing our clients a great service if we didn’t try to negotiate and get the price down a little bit. Right. And rule of thumb, which really doesn’t apply here, is anything within 10 percent, anything below 10 percent is a super low ball offer. Well, if you’re looking at three, 15. To two fifty four is what this came in at, that’s way beyond the low ball offer.
OK, so what you want to do is think about it. You want to respond carefully, because what you want to understand is someone took the effort, took the time and effort to submit an offer. So that’s something, right? He didn’t do it verbal. He did it in writing, sent it over. And you know what? What we did when we got the offer is we looked back because we had a lot of showings yesterday. This house just came on the market. And immediately all of these showings, I don’t show that this particular agent even showed the property. So that tells me that maybe they’re just sending out random and multiple offers everywhere, just trying to see what would stick. Right. So I thought about it for a minute and I, I didn’t column. What I did is sent an email and I said, hey, we really appreciate your offer. However, I feel that maybe you’re confused, confusing our property with possibly another one because we just listed today and the price that the list price is 315. So could you please? Let us know, and so I didn’t hear anything, but Kim did.
Kim got the offer again this time my name, my email was left off of it, so it was quite interesting. So let’s talk about what to do in these situations. OK, so you can do it the way I did it. Just remember to be cordial and be a good agent and represent yourself properly and think.
Hey, it’s an offer. OK, now what we do with it, you know, it’s up to you, but we did get an offer, so I think somebody was serious enough to put that offer in. Now, whether you can negotiate and get that price up, I don’t know. I had one a few weeks ago. Same thing. Got a low offer. I said absolutely not. Sellers not going to take it. I’m really sorry, but we’ve had offers like this in the past. If you want this property, then you’re going to have to come in at full price because that is what my seller instructed me to do and they did in closing.
So the other thing you can do is instead of countering and kind of playing that game, what I like to suggest is to use a form that we have. It’s a Texas Realtors form and we’re going to pull it up right now. And it’s the seller’s invitation to buyer to submit a new offer because we don’t really know what they’re thinking and maybe we don’t want them to know what we’re thinking. So if it’s that far off, I would suggest always respond.
You should always respond to offers. Yes. Always don’t ignore an offer.
But you can put this together. And this is, you know, back to the buyer from the seller and just letting them know, sorry, we don’t accept your your offer that you submitted, but you’re invited to submit an other offer. And if the seller is is, you know, giving you some guidance and saying, hey, let’s go back at this price, you can put that in their seller, maybe sell. So you’re invited to submit another offer. Which seller may more favorably consider if.
You put in a realistic offer, no, you can’t say that yesterday all these things were going through my mind and I just was ready to pick up the phone. Practice what you preach. So anyway, that’s a form that you can use in that instance and it is in your templates and enter in your listing packet. So feel free to use that any time. And if you scroll down a little bit, your seller can sign it and send it back. This is also really good to use something like this.
If you’re in multiple offers, OK, and you want to send something back to let them know that you have received multiple offers or, you know, sometimes agents get a feeling, did you even ever submit my offer?
Did the buyer even or did the seller even see my offer? So this is a good way. You know, if you have that conversation with your client and they say, hey, we’re at or above list price, then you could say in here we’re in multiple offers.
I would suggest at or above list, you know, list price if you want to be competitive. So. If, as usual, if you have any questions on that, let me know, but just be careful how you respond, but do respond if you get a low ball offer.