Home buyers who are looking for big discounts on housing nowadays are finding that their lowball offers are no longer sticking with sellers, and that their offers are getting a flat-out “no” when they’re way below the asking price.
“Right off the bat, buyers say, ‘I want a steal,’ and I tell them they have to wipe that word out of their vocabulary,” says Jackie Smith, a real estate agent in Florida’s Broward and Palm Beach counties.
“People come in, and they think the market is 2008 or 2009, when sellers were desperate,” says Jennifer Sommers, a real estate agent with Nestler Poletto Sotheby’s International Realty in Boca Raton, Fla. “They’re not desperate. Not at all.”
What qualifies as a lowball offer? Randy Bianchi, co-owner of Paradise Properties of Florida in West Palm Beach, Fla., says that sellers generally consider lowball offers to be less than 90 percent of their asking price.
Buyers, on the other hand, he says tend to say offers of 80 percent to 85 percent of the list price are reasonable.
“The mistake some buyers make is going so low it’s not even reasonable,” says Stephanie Chen, a seller in Weston, Fla., who refused to take an offer $40,000 less than her asking price. “We just walked away from the table.”
Another big mistakes home buyers are making in today’s changing housing market is that they are taking too long to make an offer, real estate professionals say, and because of that they are losing out on getting the house they want. The number of for-sale homes on the market nationwide has shrunk considerably in recent months, bringing out higher competition for properties, particularly for move-in ready homes.
The Other side of the coin is, some homes are STILL WAY OVER PRICED for the condition. Listing Realtors need to do a better job in assessing a homes value in the current market conditions.
The home must be in “almost brand spanking new condition” to list and get current market value.
Paint: Homes that need even paint and minor wall repair, No “its not just cosmetic” its money out of a buyers pocket. Figure $3 to $5 / sq ft less if the home has not been painted in the past 2 years.
Flooring: Same goes with flooring. When the carpet is worn or out of date, or cheap laminate flooring that sounds like plastic when you walk on it, it most be replaced. Again, NO you can not provided a sellers allowance, but the flooring must be replaced, or the homes price discounted to reflect. $3 to $7 sq / ft to replace or discounted for flooring.
In many cases the sellers just can not do the up grades to market value do the costs. That is OK, but the homes list price must be discounted to reflect.
This “discount” can be that 10-15% lower then market value to adjust for the needed fix ups.
So is it Really a “Low ball Offer?” or is that “what the house is worth?”
20 years of rehabbing homes to bring them UP to market value and selling.
Allen Tate Realty