When selling your home, you may run into an offer, or a lowball offer, that fall far below your asking price. These low offers may only serve to make you angry, but don’t get angry! While selling your home is an emotional process, there are rational and effective strategies for dealing with a lowball offer. Sometimes a lowball offer can even turn into the right price if you handle negotiations the right way.
TIPS FOR RESPONDING TO LOWBALL OFFERS
1. Remain calm. Although your first reaction to a lowball offer may be anger or disgust, take a breath and remain calm. There is nothing to gain in making enemies.
2. Understand that sometimes buyers aren’t familiar with actual market value. They may be from somewhere where homes are much less expensive, or they could be first-time buyers who have been counseled by friends and family to start with a lowball offer.
3. Have your agent communicate that while you’re happy to work with them as buyers, you’ll need an offer that is somewhat more competitive and at a level you could consider seriously. When responding, remember that “you can catch more flies with sugar and honey than with vinegar.”
4. Consider countering for a small amount off your asking price to signal your willingness to negotiate, but reiterate that you will need to hear something more in line with market value to continue negotiations.
5. Alternately, if you are in a hurry to sell, counter with your rock-bottom offer. This number may not be close to their lowball, but it could be substantially less than your listing price. This may make the lowball buyer suddenly reconsider their position, tempted by the opportunity to purchase the property at what they consider to be a “substantial discount.”
6. Ask the buyer to justify their price. If they genuinely believe their offer is genuine and fair, they should be able to point to reasons why your listing price is inflated. Make them show their homework. If they haven’t done it, you’ll know soon enough.
7. Don’t fall for the “but we can’t afford more” pity play. Sympathize with their financial situation, but in no way let it sway you from the true value of your home.
To steer clear of lowball offers, don’t appear desperate. In your home’s descriptions, you may have listed yourself as a “motivated” seller. This will open yourself up to buyers believing that they can get away with purchasing your home for a discount.
Of course, sometimes, a stream of lowball offers can indicate that the home is priced too high. Occasionally agents will “buy the listing” by assuring sellers they can get the higher price, only to take a lower offer much later down the line. It’s not a sound strategy that I would recommend. If you’re looking for the fair market value of your home, get in touch with me today.