Real estate listing inventories in Greater Victoria have been relatively high in the past few months, so it comes as no great surprise to us that we are seeing more “Low Ball” offers in the market of late.
That being said, sales activity remains steady, albeit at a lower level than the frenetic pace set last year in the wake of low interest rates and an unwinding of demand left over from the financial crisis of late 2008 & early 2009.
When faced with more homes to choose from than usual in the current market, some buyers are starting to write very low offers in the hopes of “getting a deal”. I used quotes there because in real estate, a “deal” means different things to different people; no two houses or lots are alike.
Resist the urge to walk away
Most people realize that real estate transactions usually involve a mix of logic, emotion and pride, on both sides of the transaction. Those realizations usually fly right out the window for both the buyer (when writing the offer) and for the seller (when receiving the offer), even when the purchase price is not in “low ball” territory.
Your REALTOR® is there to help you not only with the legal, logistical and negotiating aspects of selling your home, but to also be a sounding board, an ally and your advisor for those times when emotions are running high!
If you receive a low offer on your home, do your best to limit your emotions & pride and do your best to focus on the facts.
It may help to keep in mind that even a low purchase price offer means that the buyer wants to buy your home. Many buyers may prepare a really low offer because they are afraid they will pay too much, because they are trying to get an indication of where your expectations are, or simply because they think a low ball offer is normal business practice.
Unless the offer is ludicrously low, prepare to counter the offer to keep the buyer engaged and interested in your home, because, as mentioned, they have more than a passing interest in your house.
In the absence of multiple offers for your listing, consider countering a low ball offer with the price, conditions, closing dates and other details that you’re willing to accept. If you choose to just ignore a low ball, you won’t ever know if there was a possibility of a low offer turning into a negotiated sale that leaves both parties happy!
Consider the comparable sales
Some buyers will provide a list of recent sales with their offer to attempt to justify a low offer price. Your REALTOR® will be able to help you decide if those comparables are similar to your home, or not. If the sales in that list do represent similar homes to yours and are at lower prices, you may need to lower your price if you truly want to sell your home.
In the absence of a list of comparables from the buyer, your REALTOR® can also help you prepare a list of comparable sales to send back along with your counter offer that support your asking price.