IMO there is a lot of issues with how uneducated other agents are out there. Just because you past the real estate state exam doesn't mean you are ready to start helping people buy and sell real estate.

I like that response - "not in an equity position to entertain this offer."

However, that would only be after the SELLER says no. I present all offers to my sellers. Sometimes the education, when it comes to "low ball offers" is for the SELLERS to grasp reality...

[quote=Brian Carion]I always try to respond to lowball offers with simple facts. For example, I will suggest that the sellers are not in a strong equity position to be able to entertain this offer. By keeping your response "non-personal", you will less likely invoke the emotions of the bidding party. Good luck! [/quote]

This is very smart. I would even go as far as to say that this should be part of "best practices" whether it's a low-ball offer or not. Some people - buyers, sellers, agents, brokers, you name it - put a lot of emotion into their work. Speaking in terms of facts on the ground always keeps things in perspective.

I love the "not in an equity position."

Great stuff.

[quote=Brian Carion] I will suggest that the sellers are not in a strong equity position to be able to entertain this offer.[/quote]

Would making such a statement or suggestion be a confidentiality issue and need permission from the seller make such a disclosure? My thought was that you're almost telling the buyer how much the seller owes against the loan. Obviously, you would not be disclosing an exact amount, but it seems grey to me. Then again, there is a lot of grey out there to me as I'm just entering this silly profession :)

I agree with Brian. The more you say the less someone remembers. Basically, use the K.I.S.S method wihen responding.

Low ball offers are so common, but who can blame those home buyers? It's their time to dominate now! This is why it is so critical for home sellers to adjust their mindset accordingly, that selling homes is not going to be easy.

The seller needs to put aside personal feelings and look at the positives: Hey, someone wants to buy my house! The offer to buy is binding if accepted by the seller so no buyer would present an offer unless he/she wants to live in it - investors are different, of course.

The buyer may be just testing the water. The buyer may be making an offer at his/her upper limit, but they really want the house. The buyer may have nothing better to do other than insulting the seller. We don't know the reasons for the low offers so the proper way to respond is to negotiate or make a counteroffer.

This is why it is so critical for the seller to know the home value AND their financial situation (so that they know how low they can sell the home for) and stick to the plan.

What constitutes as a low ball offer? This is the problem. A seller may think he has a house that's worth $300,000. But the bottom line is: your house is really only worth what someone will pay for it. We don't live in a perfect world and there's no such thing as a perfect house. Even brand new homes are not without problems and defects.

"Low ball" offers work quite well when a house has been sitting on the market too long. Sellers get desperate and tired. The offers have ceased coming and they eventually end up taking whatever is offered, especially if the seller is purchasing another home and is pressed for time..