Real Estate by Debbie Reynolds: Will a Lowball Offer Offend the Seller?

Will a Lowball Offer Offend the Seller?

Will a Lowball Offer Offend the Seller?

Will a lowball offer get the door slammed shut?Buyers want to feel like they are getting a deal and have negotiated the best price possible. Many buyers want to offer so low that there is a strong possibility that the seller will be offended and refuse to negotiate.

No matter how much counseling we do with a buyer, some want to do it their way and insist they know best. I first ask the buyer if they really like the house. I ask that if the seller refused to work with them on the offer and even slammed the door on negotiations would the buyer be sad. 

When offering on new homes, builders want to protect their pricing and many refuse to budge. It is just business. They may negotiate by giving an amenity in the house like better flooring or appliances or adding a fence in the backyard. Effectively this is negotiating with the builder but protects his values and his future building.

It takes educating the buyer on what is happening in the market. In very hot markets prices are going over the list price and there are no concessions being offered by the seller. It is our responsibility to prepare the buyer while we are showing property and to not lead them to believe they can bottom out the offer price.

I have seen sellers greatly offended and that refuse to even counteroffer. They are thinking the buyer is taking advantage or does not value their home. This is a very dangerous course for the buyer to take. Even some of the best negotiating agents cannot bring a severely offended seller back to the negotiation table.


Showing the buyer the market stats lays the groundwork for a good offer. If they still feel like they have to offer a little low, caution them that someone else may beat their price. Tell them they may only have one opportunity to bid and show the seller how much they like the home.

A lowball offer can backfire and fizzle out with no counteroffer. The real risk is that the buyer may lose the house entirely or have to pay even more than the seller may have been willing to take before the insult. It is risky business. Remember there are no trophies for seeing how low you can go.
 

Will a Lowball Offer Offend the Seller?

If the buyer wants to buy the house then let the offer show how much. Contact The Real Debbie Reynolds for real estate advice and guidance in buying Clarksville TN at 931-320-6730.


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Comment balloon 61 commentsDebbie Reynolds • June 21 2017 02:29AM

Comments

Low ball days are over for now, in my area.

Posted by Rob D. Shepherd, Principal Broker GRI, SRES (Windermere/lane county) over 2 years ago

Good morning Debbie. This is superb. You have done such a great job explaining this. 

Posted by Sheila Anderson, The Real Estate Whisperer Who Listens 732-715-1133 (Referral Group Incorporated) over 2 years ago

My area a low ball offer could get you  bannished.  We are still a very hot market.

Posted by William Feela, Realtor, Whispering Pines Realty 651-674-5999 No. (WHISPERING PINES REALTY) over 2 years ago

This is very important advice for prospective home buyers.

Posted by Roy Kelley (Realty Group Referrals) over 2 years ago

The buyers that put in lowball offers will be put to the side in my market

Posted by Harry F. D'Elia III, Investor , Mentor, GRI, Radio, CIPS, REOs, ABR (RentVest) over 2 years ago

Hello Debbie Reynolds,  feature button please, I see these low offers and yes some seller will not even respond to them.  

Posted by Will Hamm, "Where There's a Will, There's a Way!" (Hamm Homes) over 2 years ago

Debbie, just received one over the weekend on a new listing on the first weekend on the market.  REALLY, do they think the Sellers will take it?  If it priced too high, maybe, but not when a listing is priced just right.

Posted by Joan Cox, Denver Real Estate - Selling One Home at a Time (House to Home, Inc. - Denver Real Estate - 720-231-6373) over 2 years ago

Debbie even in cases where the counter offer is not all that low, I have seen the Seller get their back hairs up and negotiations become testy.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) over 2 years ago

Hi Debbie - I have met these people.  Frankly, I would not counter because the next issue will come up. 

Posted by Grant Schneider, Your Coach Helping You Create Successful Outcomes (Performance Development Strategies) over 2 years ago

Debbie educating the buyers comes first and if they don't want to be reasonable in the current market, well then they'll probably lose out.  My very first broker way back in the late 80's taught me when to suggest a seller simply refuse a low ball offer (but leave it open for agent to invite buyer to  submit a reasonable offer) and when to play ball and counter back.  He was a very smart man and his negotiation tactics have worked well for me for many, many years.

Posted by Anna Banana Kruchten CRB, CRS, GRI, WLS, 602-380-4886 (HomeSmart Elite Group) over 2 years ago

Hi Debbie, there are low ball offers then there are LOW BALL offers. If a house has been on the market for awhile, I will throw a low ball offer for my clients to get a feel where the sellers are. Some times there is a lot of room in the price and your doing your buyers right. I just closed on a nice home that the sellers came off almost $100,000.It's all about the art of negotiating.

Posted by Steven Nickens, R(S)GRI ABR, Maui Real Estate Hawaii (Elite Pacific Properties Maui) over 2 years ago

Steven Nickens had it right, it's all an art to negotiations. Yes, a very low ball offer is going to offend a seller and as such will affect their response. Buyers need to realize the impact of their offer and should plan ahead or anticipate what the sellers' next move should be. The biggest thing that I've seen buyers miss, is that while they are "playing around" and making offers, the seller is not obligated to accept that or counter it, and could be selling it to someone else. (then, of course, the folks making the low ball offer are upset they lost out and say "well if I would have known that I'd..." Well, you should have known, and as agents, that's what we need to make sure they are informed of!)

Posted by Stephen Turner, The BIG Guy of NEW HOME SALES (Burkentine Realty Group (Burkentien Builders)) over 2 years ago

Hi Debbie

Educating buyers in any market is key so they have the best information upon which to make a decision, and offer. Of course what they decide to do with that information is up to them and not always realistic.  Some just need to find out the hard way. Will a seller be offended by a low offer? Depends on a number of issues.

Jeff

Posted by Jeff Dowler, CRS, The Southern California Relocation Dude (eXp Realty of California) over 2 years ago

I do not work with anyone as a seller who looks at any offer as an insult. I have worked some pretty sweet deals from lowball offers as long as the seller is willing to keep communication going.

Posted by Joe Pryor, REALTOR® - Oklahoma Investment Properties (The Virtual Real Estate Team) over 2 years ago

Most sellers appreciate nice clean offers.  Buyers think if they come in low, the seller will come down more off the list, but it doesn't work that way. Some buyers just like to do it their way, so if that is the case, I let them. Lose a few homes and they wise up!

Posted by Patti Irwin, No Pressure, No Sales Pitch, Just Expert Advice! (HomeSmart Lifestyles-Fountain Hills AZ Real Estate) over 2 years ago

Good advice for buyers really wanting to get a home.  If you want the home, pay what it's worth.  I never understood the concept of the "offended" seller, though -- they should expect some people trying to get a steal, and counter appropriately.  Nothing wrong with a full priced counter offer (or heck, a higher than list counter...)

Posted by John Meussner, #MortgageMadeEasy Walnut Creek, CA 484-680-4852 (Mason-McDuffie Mortgage, Conventional Loans, Jumbo Loans, FHA, 203(k), USDA, VA,) over 2 years ago

I agree with your points and add that one of my sellers refused to deal with a lowball buyer and it ended up being to the seller's detriment.  The lowballer came back with two more offers, dismissed by the seller.  Months later the seller accepted an offer significantly less than the lowballer's offer.

Posted by Hawaii homes (Century 21 iProperties Hawaii) over 2 years ago

What does it take to get the home not I go low you go high.... prevails today

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) over 2 years ago

In our market, in won't offend the seller, it will just not be taken seriously or considered amidst multiple other offers. 

Posted by Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES, Florida Waterfront and Country Club Living (Tropic Shores Realty - Ich spreche Deutsch!) over 2 years ago

sadly, sometimes it takes losing out on a home they *really* liked before they learn this vital lesson.

Posted by Greg Large, A Tradition of Trust (ERA Real Solutions) over 2 years ago

That is a yes, a yes and a yes as sellers in this market, can really get upset over such a poor choice, to make a low ball offer. Many lead to out right rejection and not even a counter offer Debbie Reynolds . Some buyers have to lose a home they love to get realistic

Posted by Scott Godzyk, One of the Manchester NH's area Leading Agents (Godzyk Real Estate Services) over 2 years ago

so true... great post!

 

Posted by Lesley Wilson-VanGoethem, Residential Real Estate Broker Associate (Innovative Realty Solutions Group) over 2 years ago

Will a seller get offended? That depends and has happened to me. We did not even get a counter offer, now the home has been on the market for nine months and we are waiting for it go go even lower.

Posted by Eva B. Liland Century 21 Doug Anderson, Glad to be of Service 661-714-1643 (Century 21 Doug Anderson) over 2 years ago

I see a variety of reactions by sellers to low offers. Some remember when they made lowball offers, and understand. Others look at complete offer, not just price, and if they feel buyer isn't serious, that ends it with that buyer. Others will counter well above list price to send clear message that they aren't interested in playing games with time wasters. This is assuming sellers know what their house is worth and know it's priced correctly.

Posted by Jeff Pearl, Full Service Full Time Realtor (RE/MAX Distinctive / LIC in VA) over 2 years ago

Will the seller get offended? Some will some won't. I have one we put an offer on after the listing agent said the seller wouldn't get offended...never received a counter and house still sits. My buyers are waiting patiently...and they know they'll either get it or they won't but they will wait till it comes down to their price.

Posted by shirley cicero, Northern Colorado Mountain Homes and Vacant Land (Continental West Realty) over 2 years ago

The key is making a fair offer based on the property condition and location. The offer may or may not be anywhere near list price. This topic goes hand-in-hand with the seller's who insist on over pricing their properties and the agents who accomodate them. (who aren't here of course.)

Posted by Darrin Carey, Real Estate Buyer (Homes and More, Inc) over 2 years ago

Congratulations on the well deserved feature. Some buyers just don't get it and find themselves missing out on homes that would be perfect because they don't listen or understand the current real estate market. You can only lead a horse to water but can't make them drink it! LOL!

Posted by Dorie Dillard CRS GRI ABR, Serving Buyers & Sellers in NW Austin Real Estate (Coldwell Banker United Realtors® ~ 512.750.6899) over 2 years ago

It's a hot market indeed. Yet some properties are not selling because they are overpriced. Overpriced?! They've been on the market for awhile. That's when you can go low.

It's a strategy. Sometimes it works. We got a property listed at $689,000 for $617,000.  

 

Posted by Ernest Villafranca, 3923 Grand Ave. Oakland CA, 510-418-9443 (Better Homes and Gardens Real Estate ) over 2 years ago

I  received a low ball yesterday. Low meaning it was lower than asking price by 19K. All offers I received rently years start about > X% higher and up.  I do not know what went through agent's mind as there are about 40 signatures to sign all disclosures per borrower.   The asked price is lower than appraised nothing wrong with the price.

 

Posted by Sam Shueh, mba, cdpe, reopro, pe ( (408) 425-1601) over 2 years ago

Great Post Debbie Reynolds ... I agree 100%!  When I take out a buyer the very first time I spend a solid amount of time talking about the market -- yesterday and today -- so that they have a good understanding of what is going on.  I still have those buyers who think they can low-ball but it rarely happens more than once.  After that they learn a hard lesson and then they listen to me.  I'm thankful that it's a very rare occurence.  Most of my buyers respect and listen to me and we end up winning -- but not always. 

Posted by Diana Dahlberg, Real Estate in Kenosha, WI since 1994 262-308-3563 (1 Month Realty) over 2 years ago

Debbie I agree with you, it takes a lot of skill and persuasion and willingness for a listing agent to participate and convince their sellers to respond... I just closed a deal where the buyer offered less than what the seller paid and I begged and he did participate in the shared for I lost track of how many counter offers...but we did make a deal... this is a minuscule percentage because most agents and sellers are not in the mood to play...Endre

Posted by Endre Barath, Jr., Realtor - Los Angeles Home Sales 310.486.1002 (Berkshire Hathaway HomeServices) over 2 years ago

Let's just say that I agree that it's not flattering but understand that there are different strokes for different folks in that way.

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) over 2 years ago

Endre Barath, Jr. , I know it can be hard but it's all make it worth it in the end it's in the right way

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) over 2 years ago

I had buyers who wanted to put a very low offer in on a home once - they had their own reasoning and were adamant. So we put it in and I presented it in the best light. The listing agent indicated the sellers were insulted and they would not come down a dime (he said things like "don't you know they paid $xxx for this place," and "the buyers did everything wrong with this offer"). My buyers asked me to tell them they would be open to discussing the offer if the sellers decided they wanted to talk further.

They then immediately made a similar offer on another place (low price). In this case, the sellers were open to negotiating and we came up an agreed upon price very quickly. The buyers closed on that home while the first home sat on the market. Unfortunately for the insulted sellers, their home never sold. It expired and sits there today.

Posted by Kat Palmiotti, The House Kat (406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty) over 2 years ago

The bottom line is how much the buyer wants it. If it is truly "the one" they need to understand the risk of losing it with a low offer.

Posted by Sharon Tara, New Hampshire Home Stager (Sharon Tara Transformations) over 2 years ago

In the land of short inventory, this type of offer is a waste of paper, but there are always "those" buyers. On the flip side the sellers can be a bit unreasonable as well. This is where an agent's expertise comes in. We must do our best to educate both sides.
Great post, Debbie.

Posted by Chris Lima, Local or Global-Allow me to open doors for you. (Atlantic Shores Realty Expertise) over 2 years ago

Debbie, I think a lot depends on the market.  You are absolutely correct, many Sellers get offended when a Buyer makes a "low-ball" offer, but if the house has been on the market a good while because of being over priced it can be a wake-up call for the Seller.

If you are the listing agent, the best strategy is to make sure the Seller knows you are only the messenger and to keep it business - not personal.  I have never met a Buyer that just wanted to offend the seller, they just want the best deal they can get.

Posted by John Dotson, The experience to get you to the other side! (Preferred Properties of Highlands, Inc. - Highlands, NC) over 2 years ago

A lot has to do with how you frame the "low" offer.  If you just send over the offer and let the offer speak for itself, you allow the seller to fill in the blanks and create their own vision of what the buyer is up to.  So it's important to give some background and explanation for the offer.  

As far as builders not being negotiable, I've been pleasantly surprised five times this year.  Each builder agent gave each of my buyers the same story line.  They all seemed very sincere in their belief that the builder woundn't budge on their pricing.  When we held firm and told them to just see what they could do, each one came back with a price they told us at the  beginning would be impossible.  Sure it was a little uncomfortable.  It's always easier to just accept the seller's price.  But with a few words you can save $10,000 or more.

Posted by Tim Maitski, Truth, Excellence and a Good Deal (Atlanta Communities Real Estate Brokerage) over 2 years ago

There are times for low offers, this is not one of them. The market is hopping, unless you find that home that has been sitting and the seller has now got serious about wanting to sell.

Posted by Nick Vandekar, 610-203-4543, Tredyffrin Easttown Realtor, Philly Main Line (Long & Foster Real Estate Inc 610-225-7400) over 2 years ago

Rather than focus on whether a seller will be offended by a low ball offer I try to understand why a buyer would make such a poor offer.  Most of the time I find they lack motivation to buy at market...i.e., tire kickers!

Posted by Gary L. Waters Broker Associate, Bucci Realty, Fifteen Years Experience in Brevard County (Bucci Realty, Inc.) over 2 years ago

Sellers will often be offended by a low offer. I can usually get them to at least counter by says "Don't be offended by the offer, it's just a starting place. Be offended by all the people that saw your house and didn't make an offer."

Now if the buyer comes back after our counter and is still extremely low we may just reject but I've sold plenty where the initial offer was very low.

Posted by Patrick Willard over 2 years ago

Great post Debbie. This concept of insulting the seller is a bit dramatic in my view. A low ball offer is still better than no offer. It's easy just to say no, it's easy just to ignore it, and it's easy for the seller to provide instructions to the listing agent to automatically reject all offers under x amount and not to bother presenting them. It's no big deal.

I get low ball offers from time to time and they just sit in my inbox to be soon deleted. More than often, the buyer agent or the buyer does not even call me for follow up and the whole hoopla just dies in my inbox. I spent a whole 2 seconds of my time.

Posted by Richard Bazinet /MBA, CRS, ABR, Phoenix Scottsdale. Sellers, Buyers & Relocations (West USA Realty) over 2 years ago

I made a low-ball offer on a lake house to a FSBO many years ago. He cussed me out which I took as his counter. So I countered with a full-price cash offer which he rejected. He told me that I insulted him and under no circumstances would he sell me the house. Within three months he sold the house and everytime I passed the house from then on I got a sick feeling. The FSBO taught me a valuable lesson Debbie! Your post is definitely on the money.  

Posted by James (Jim) Lawson, DBA, Broker Associate, RSPS, BPOR, HI & PE (DomainRealty.com LLC) over 2 years ago

Am I the only one that feels that buyers have to learn the hard way by losing out on those homes they really love before they will "get real"? 

Posted by Shanna Day Team Leader AZ & UT - Call 480-415-7616, Top .0033% of 40,000+ Realtors in our MLS (Keller Williams Realty EV (AZ) & Keller Williams SLC (UT)) over 2 years ago

Great article Debbie and so true. Sometimes those low offers are warranted. On one home, in particular, I prepared in-depth comps, remodel costs and a great presentation to show why my buyer's offer is low and why it should be accepted. The owner was an appraiser and landlord who couldn't accept the reality of numbers, something an appraiser when not personally involved would know and appreciate. When we are personally attached to a home, it is harder to see the reasoning.

Posted by David Wright, Real Estate Refined (Benchmark Realty, LLC) over 2 years ago

I might add, the seller's agent was totally impressed with my presentation, she said it was the best she had seen and actually sided with us on presenting the lower offer. She, too, was shocked the owner wouldn't accept. Later the home was pulled off the market and returned as a rental.

Posted by David Wright, Real Estate Refined (Benchmark Realty, LLC) over 2 years ago

Dear Debbie,

With information everywhere these days, it is hard to imagine how all parties would not have a decent idea of the values of just about anything, especially houses.

Posted by Dörte Engel, ABC - Annapolis, Bowie, Crofton & rest of Maryland (RE/MAX Leading Edge) over 2 years ago

I have been the middleman in many of these negotiation where a buyer comes in $20k less than the asking price and then wants closing costs put on the top of that Debbie Reynolds. Often times, the house has only been on the market for maybe a week . I council my seller not to be offended but to come back with the offer makes us too far apart to negotiate. Four out of five times the Buyer has come back with a full price offer and than adds the closing costs to the list price.

Posted by Paul S. Henderson, REALTOR®, CRS, South Puget Sound Washington Agent/Broker! (Fathom Realty Washington) over 2 years ago

Debbie

Low ball offers are like fishing . . . . The is hoping to catch something.  Where it's really becomes an exercise in drowning worms.

Good luck and success.

Lou Ludwig

Posted by Lou Ludwig, Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC (Ludwig & Associates) over 2 years ago

Debbie

A well desired feature for an outstanding post.

Good luck and success.

Lou Ludwig

Posted by Lou Ludwig, Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC (Ludwig & Associates) over 2 years ago

I am working with an out of state buyer who is doing the low offer based upon what is often seen in their home state. not working to their advantage

Posted by Anna Hatridge, Missouri Realtor with R Gilliam Real Estate LLC (R Gilliam Real Estate LLC) over 2 years ago

Great post and it has produced some interesting comments.

It is important for the agent, both buyer's and seller's, to educate on the process and what is really going on in the market.

I try to help my sellers understand that being offended may mean not selling the house. A low offer is a time to start the negotiations.

Thanks

Posted by John Wiley, Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA over 2 years ago

Lowball offers are only offensive when there's no justifiable reason for them. If the market or situation supports the lower price, I'm all for it.

Posted by Nathan Gesner, Broker / Property Manager (American West Realty and Management) over 2 years ago

Debbie Reynolds I've worked with some buyers where no matter what property they look at, they make some comment about how it's over priced.  In a seller's market, I don't have time for that crap.  Go work with that relative you're always talking about who just got licensed. Let them waste their time with your lame low ball offers 

Posted by Jim Cheney, Rincon Valley Realtor 707.494.1055 (Saint Francis Property Santa Rosa, CA) over 2 years ago

Low offers might be legitimate, yet that depends on the condition of the property. For example, I recently viewed a 3/2, 1300sf townhouse with average CMA of $600k, however, to bring the value to CMV, a buyer would have to spend $50k or more, so, would $560k be considered a low ball offer?

However, more times than not, low offers indicates a buyer who is ignorant about the RE market or is fishing as Lou, #57, stated. 

Low offers are irritating and offensive, yet some agents will spend the time to write the offer. So, what does that say about the agent and his branding perception that submitted the low ball offer? Sometimes, it's best to protect your assets and terminate a contract or as you illustrated, to educate your buyers about the process and nuances of successful RE negotiations. Great post.

Posted by Kimo Jarrett, Pro Lifestyle Solutions (WikiWiki Realty) over 2 years ago

Excellent advice and opinions on why a buyer should think twice about offering such a low price as to offend the seller.  

Posted by Jan Green, HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN (Value Added Service, 602-620-2699) over 2 years ago

Making lowball offers in a sellers market especially with multiple offers will always end in disappointment. But there is one area a buyer can count on a low offer being 1st; 1st to not being considered at all. 

Posted by Stavrula "Sam" Crafa, RNC,GRI, CDPE, PSA, Providing the integrity and service you deserve. (Future Home Realty) over 2 years ago

I totally agree with what you said, that "The buyers may end up paying more than what the seller would have been willing to sell for" and "there is no rophy for seeing how low you can go"!  May I quote you on that?  

Posted by Shanna Day Team Leader AZ & UT - Call 480-415-7616, Top .0033% of 40,000+ Realtors in our MLS (Keller Williams Realty EV (AZ) & Keller Williams SLC (UT)) over 2 years ago

My low ball client would say, they aren't real sellers, where actually he wasn't a real buyer, ok he did buy two properties but drove me crazy.

Posted by Steven Nickens, R(S)GRI ABR, Maui Real Estate Hawaii (Elite Pacific Properties Maui) over 2 years ago

Hi Debbie, 

I saw this on Joan Cox 's reblog. Congrats on the well deserved feature.  I enjoyed reading a lot of the answers!  Low ball offers in this market are really a waste of time for the buyer's agent. I would educate my buyers. 

Posted by Sheri Sperry - MCNE®, (928) 274-7355 ~ YOUR Solutions REALTOR® (Coldwell Banker Residential Brokerage) over 2 years ago

In a seller's market some sellers think they can name any price. If the list price is unreasonably high, then the "lowball" offer may actually be the true market value.

Posted by Dave Halpern, Louisville Short Sale Expert (Keller Williams Realty Louisville East (502) 664-7827) over 2 years ago

Participate