Low ball offers are always a risk, ones that can have a great payoff for the buyers. But the low ball is an art form in and of itself, and those who want to use it must be careful not to make many of the small mistakes that turn sellers off. Here are some of the most common low ball mistakes that people make when buying a home, and how to avoid doing them the next time you go bargain hunting for property.
1. Not Factoring In Other Things
A lowball offer still has to have stuff that the seller wants, even if the price isn’t what they want. In these terms, it may be best to think of your lowball offer like a nonprofit looking for good workers. Classically, nonprofits offer much lower wages than private corporations, so to attract great accountants and professionals, they offer perks that people would want, like shorter work weeks, more vacation, and other such incentives. If your lowball offer is much less money and still a lot of hassle, a seller is going to pass. The biggest factor for many sellers is the sale being dependent on the sale of the buyer’s other property. So if you’re going to lowball, make sure the deal isn’t dependent on the sale of your other property. Sell that first, then go bargain hunting.
2. Not Being Willing To Negotiate
If you have ever haggled or bartered in a market, you know that not budging on price will leave you empty-handed. Many people who make the lowball offer think they have all the power, since they are the ones offering money, but that isn’t necessarily the case. Sellers may hold off if you aren’t willing to budge on the price. Think of your lowball as a first attempt, making sure you have room to negotiate with the price. If you remain steadfast in your initial offer, the seller will likely be frustrated with you and simply walk away, waiting for anything better.
3. Not Doing Your Homework
Lowballing works best when the person making the offer has a substantial understanding of the local real estate market. In places like Edmonton, this means knowing where houses are appreciating, where they’re lying flat, and where they’re depreciating. Despite housing prices being relatively stable in Edmonton, assuming you know everything because of a tertiary glance in the papers will leave you ill-equipped to make a plausible lowball offer. That initial offer has to hit a sweet spot, after all, between enticing and great value for you. If you don’t know the markets, you will have no idea what the price you should offer would be.
The lowball offer can net you an amazing property for a low price, but only if you do it right. Be sure to construct a solid offer when making a lowball, one that provides something that will impress the seller, even if the final amount will not.