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| Offers
and Counteroffers |
When offer is presented, the
seller may decide to respond with a counteroffer or
not to respond at all. In the latest case, no news is
bad news, as the seller may not feel the offer deserves
a response. On the other hand, if the seller responds
with a counteroffer, you can be assured the seller is
taking your offer seriously, however, either the price
or terms or both are not to the seller’s liking.
The counteroffer will give details of this. For example,
if the price is the issue and you offered a low-ball
bid, the seller will respond with a higher price and
the same holds true for the terms. If you offer a low
ball bid due to the fact that similar homes in the area
have sold for the lower than asking price and you have
evidence of this, provide the evidence with the offer.
If you believe you are in the seller’s market and
there are other offers for the home you are bidding
on, you may want to offer close to the asking price.
You may even want to offer a little more than the asking
price, however, do remember what you calculated you
could afford. In a bidding war it is often a good strategy
for the buyer and agent to have discussed multiple offers
so the agent can present different option with the buyer
approval. This strategy is generally used if it is a
strong seller’s market and there is a bidding war
being conducted by multiple brokers.
In an aggressive market some of the other negotiating
strategies include:
- Making an open ended offer. For example,
offering a percent or a specific amount of money higher
than the highest bid.
- Allowing the seller to choose the closing date.
- Remove as many contingencies as you can.
The first to go is the financing contingency, which
means you are pre approved by a lender and have a
letter of commitment. Some people feel this is the
same as having cash. The next contingency to remove
should probably be the home inspection. Again, it
depends on how much you want the home and the type
of market you are in.
- Offer the asking price or higher. Nothing
gets a sellers attention more than an offer containing
the numbers he or she was hoping to see.
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