How to respond to, and turn a low ball offers Asheville in your favor. At the end of the day, everyone on each end of a transaction is just trying to get the best deal. Just because someone might throw out a low ball offer to start, doesn’t mean both parties can’t come to an agreement that’s in everybody’s best interest.
Here’s the scenario: you’re trying to sell your home, and you’ve listed it at the price that you and your real estate agent have agreed upon. It’s comparable to other homes in the area, and in line with what they’ve sold for in recent months. This is Asheville, so you’re expecting multiple offers to come in quickly, maybe even above list price. You’re excited when your first offer comes in, but then you see it – it’s a low-ball offer, tens of thousands below list price.
At first, you might feel insulted – especially if you have an emotional attachment to the home, and feel strongly that it’s worth what you’re asking. How could this buyer think that you’d even entertain their offer, when the home is clearly worth so much more? You might be inclined to immediately dismiss the offer, and wait for the next one to come in. Don’t be too hasty, though – before you resolve to deny any low-ball offer that might come in, read on to find out the best way to handle low ball offers if and when you receive them!
First of all, don’t panic – low-ball offers are uncommon in the current Asheville real estate market, because it is so competitive and such a strong seller’s market. Even if you do receive one offer well below list price, you’re unlikely to get multiple low-ball offers. That doesn’t mean that you should ignore the lower offers, though, and, as things begin to shift in the Asheville market you may start to see more of them. It’s important to understand how to respond to a low-ball offer, whether you get one or many offers below list price, so that you can be best prepared to get the highest possible value for your home.
If you get a low ball offer, consider the following:
- Always counter! This is the golden rule of low ball offers. Your goal is to sell your house, and it won’t hurt you to respond with an offer that makes sense to you – try not to get emotional about the offer, and keep the lines of communication open. Even if the offer feels insulting, try not to be offended. While you have a personal connection to the home, remember that the potential buyer does not – at least not yet! It may be worth considering why you feel that the home is worth more, and reevaluating whether your valuation is logical and based on data or emotional and based on feeling. If it’s the latter, you may want to reconsider the price at which you’re listing the home, and possibly even consider accepting what you initially saw as a low-ball offer.
- Consider speed to close. If the potential buyer is able to close very quickly, and if closing speed is an important factor to you (if, say, you need to move or have already moved, or need the money from the current home in order to purchase another), the lower offer may be offset by the expenses you would otherwise have to pay to keep up the property while you wait for it to sell. If you can, sit down and work out the numbers – calculate how much you would spend on upkeep, property taxes, the mortgage if you have one, and so forth should the property not sell for another two weeks, month, six months, or a year, and balance that with the lower sale price you would get it you accepted the low-ball offer. While the Asheville real estate market is strong, it isn’t unheard of for properties to sit for an extended period of time, especially if they’re not priced as fairly as the seller thinks that they are. Consider every factor, and determine whether the low-ball offer might make sense in the long run.
- Look at concessions. If the potential buyer isn’t asking for any concessions, the lower offer may not be as low as it first appears. Consider the cost of any concessions that a buyer coming in with a higher offer might request – help with closing costs, assistance in making certain improvements, and so on – and determine whether you’re likely to end up with a lower profit even if you do get a higher offer at face value. If the low-ball offer is plain and simple with no concessions, it may even wind up being the higher offer!
- Think about inspection contingencies. If the buyer who’s come in with a low-ball offer is offering to buy the property as-is and is not asking for any repairs to be made, it may be worth considering the lower offer. Especially if yours is an older home that may need significant work that could become quite expensive, this is an important factor to consider. A buyer with a higher offer at face-value, for example, might ask for the roof to be replaced, a new well pump to be installed, electrical lines to be rewired, and more. These items can get expensive quickly, and could easily push your profit below that which you would receive if you simply accepted the low-ball offer!
- Consider the type of financing. Is the buyer offering a cash deal, or is there a mortgage involved? If there is a mortgage, what type of loan do they have? Also, take a look at how much the buyer is putting down. These factors are particularly important in determining how likely the sale is to actually go through. If the buyer is offering cash with a 40% down payment, for example, that’s a good indication that they’re serious about the purchase and aren’t likely to back out. A buyer coming in with a higher offer but only 10% down and a certain type of loan, however, might be less serious or less secure in their offer and more likely to back out.
- Look at due diligence and earnest money. Much like financing, this is a good indication of how serious the buyer is about the purchase. If they’re offering high amounts of due diligence and earnest money, they’re probably serious about buying. Being able to close the sale in a timely manner without having to worry about the buyer backing out may end up being more profitable for you in the long run, even if they come in with what you see as a low-ball offer, if you don’t have to deal with multiple offers coming in and then backing out.
- And, of course, rely on your agent! If your seller’s agent things that you should consider the low-ball offer, or if they have advice on how you should deal with it, listen to them. Even if the offer feels low to you, understand that your agent is the expert, and has likely considered a number of factors – such as those above – that you may not have thought about. If the agent feels like they can work with the offer, give it a shot!
A low-ball offer isn’t any seller’s dream offer, and it isn’t something you see every day in the Asheville real estate market. But if you’re looking to sell your home in Asheville today or in the future, it’s important to understand how to deal with a low ball offer and how to determine whether it’s worth considering. By using the tips above, you can successfully navigate a low-ball offer coming in below list price, and ensure that you get the best value possible for your property. And, above all else, remember the golden rule of low-ball offers: always counter!