Accepting Offers

"Low Ball" Offers

In every real estate market, there are buyers who make offers that are far below the current market value. How should you react if your agent brings you one of these "low balls"?

If your home is priced well, you can reject the offer and be reasonably confident that a better one will follow. In a buyers' market, however, you may not have that luxury. Try to get an idea of the buyer's overall strategy, and ask your Realtor for advice. Do they really want your house or will they move on to another property if you make a counter offer? Can they afford to pay a higher price? Are there ways to close the gap with a small owner take-back, or with terms that will increase your bottom line? It may be necessary to take a hard look at your asking price. If your price is on the high side, the offer may not be that unreasonable. We recommend that you don't "just say no" to a low offer until you have explored all the options.

A Tough Sale

You found the perfect house in the Overland Park area, and you made a very low offer. The sellers responded with a counter-offer which was several thousand dollars lower than their asking price. You came back with a slightly higher bid, and they came down some more. After many days of back and forth, you finally reached a meeting of the minds, and you are very pleased with the results.If you have driven a hard bargain for a house, try to be sensitive about making any additional requests from the sellers. As you move toward your closing date, keep in mind that the sellers may not share your elation. They may still be suffering from the negotiations. If you and the sellers are feeling a little ragged after a rough negotiation, you still have time to help everyone walk away from the transaction feeling satisfied with the outcome.

Accepting An Offer

Your Realtor has just brought you an offer on your home, and you want to think about it. You would like your agent to contact the other people who have shown an interest in your home. Whether your home has been listed for two days or two years, there is always a desire to hold out for more money, and sometimes sellers feel a lot of resistance to making a decision.

Some buyers will include a deadline for getting a response in their offer, but even if there isn't a deadline, you should respond to a buyer's offer quickly. The period between the time an offer is submitted and a response is made is a crucial one because the buyers are free to withdraw from the transaction. Even though they are mentally landscaping your yard and arranging their things in your rooms, they may also be afraid that they will get the house, and are, therefore, extremely vulnerable to buyers' remorse.

Clean Offers

You have found a house in the Overland Park area that makes your heart skip a beat--it is in the right location and has all the amenities you want. The price is the only thing that is keeping you from making an offer--you feel that it is more than you can afford. How can you maximize the possibility that the owners will accept an offer that is much less than they are asking?

The first thing you should do is to make the offer as "clean" as possible by not asking for special contingencies. Avoid making demands on the sellers for minor repairs, such as cutting down the dead tree in the back yard or leaving custom drapes. Be as flexible as possible about scheduling the registration date to fit the sellers' moving plans. Finally, you can offer a larger-than-usual deposit to persuade the sellers that you are a serious buyer and to make it harder for them to "just say no". Each situation is different, however, but the simpler the offer, the more likely the sellers are to accept it.

Evaluating Multiple Bids

When you are faced with multiple offers on your home, how do you choose the right one? We can help you compare and contrast the terms of each proposal.

First, there is the price. Consider the closing costs you may be asked to pay, and be sure that you understand any other terms that might reduce your net profit. Can you work out a mutually agreeable date for you to move out and for the buyers to move in? How "clean" is each offer? Do the buyers have another property to sell before they can close on yours? Can you get reasonable assurances that the buyers will be able to qualify for the financing they will need?

We can help you weigh the relative merits of each offer, so that you can accept--or counter--the best one, and line up one as an alternative.

Is First Always Best?

Your home has been listed for just a few days, and your Realtor calls with great news. The people who looked at the house last night have come in with an offer to buy it! When the agents arrive to present the offer, you are excited and nervous. As they explain the price and terms, however, you feel that the price is a little too low and that the offer contains some terms that will be either expensive or inconvenient for you to meet. Should you try to work it out or wait for something better? Work it out! Often the first offer to come in is the best one. When a house is fresh on the market, there is usually a rush of activity and the buyers who see it during the first few days are those most likely to be the most interested. If you are fortunate enough to get an offer right away, you will probably be better off in the long run if you accept it or try to work out a compromise.

Know Your Price Range

You have just found the perfect new home for your growing family, but it is a little out of your price range--unless you can get an extra $20,000 for your current home. One can never be sure how much a home will sell for. It is always possible to list a home for a little more than it may be worth in the hopes that you could get lucky. After all, it just takes one buyer, and the market is busy!

However, if you want to sell your home quickly, maybe you should consider taking less than you hoped to get, therefore, keeping the price a little lower. Don't buy and sell so close to the wire that you become concerned that the numbers aren't as close as you would like them to be. If you set your price within 5% of the market value, you greatly increase your chances of getting good offers that will result in a relatively fast sale. There may be other ways to increase your buying power and get you into that new home, such as adjustable rate mortgages or owner financing. When you are selling one home and buying another, you will need more than luck and the possibility of finding one person who may be willing to pay the extra amount you would like to get. Remember, you will need a highly professional Realtor who can give you solid advice on how to make the transaction work for you.

Negotiating Factors

It is easy to be offended by someone who is making an offer on your property. Even if the buyers love your house, they are trying to negotiate the best possible price and terms. They probably will not let you know how much they want your home until they have a purchase and sales agreement.

Buyers almost never write offers that please the sellers entirely. Offers and counter offers may be traded back and forth over a few days or even weeks. When there is finally a meeting of the minds, both sides may feel worn down by the whole process. One of our most important jobs is to act as the intermediary during such negotiations. With our knowledge of financing, negotiation procedures, and the tax laws affecting real estate sales, we come up with creative solutions to the challenges that may arise.

Negotiations

The beginning of negotiations is usually the end of many months of hard work for the buyer or seller. The work ahead requires skill in order to maintain a strong position.

Sellers can lose their advantage if they do not counter an offer that a buyer has made. Even if the opening offer is beneath what the seller feels is reasonable, it is advisable for the seller to respond with a slight reduction from the asking price. The most important component in negotiating is good communication.

The best way to handle a low offer is to counter it with definite terms that are favorable to the seller. A counter offer has two advantages: 1) it keeps the buyer interested, and 2) it moves the negotiation forward and gives the buyer the opportunity to submit another offer that the seller is more likely to prefer.

Offers and Counter Offers

Many of the offers we submit for prospective buyers aren't exactly what the sellers want; the price may be lower than they are asking or there might be terms that will require negotiation. What happens after the offer is submitted?

The seller's Realtor will present the offer to the sellers, along with the buyer's qualifications. If the sellers accept the offer, then you have a purchase agreement. If the sellers counter the offer, the next action would be initiated by the buyers. If you want to buy a particular house, your chances of succeeding are greater if your offer is as close to the asking price as possible. You could save money by engaging in lengthy negotiations, but you run the risk of losing the home if another offer comes in or you risk offending the seller.

Purchase Negotiations

When your Realtor calls to say there is an offer on your home, you get excited. Then you hear the offer and get an adrenaline rush. Whether the offer is good or bad, you should just remain calm--and discuss a counter-offer with your Realtor. The negotiations of a purchase begin with the buyer's ideal terms and a counter offer of the seller's ideal terms.

We will look beyond the price when evaluating an offer. If the buyers' financial qualifications are shaky or the offer has subtle terms or conditions, we will be there to minimize any risk to you and to address these items in your counter-offer. Our job is not to make a decision for you, but to be sure that you understand fully what the offer includes and what is expected of you.