The holiday season is here and homes that didn't sell during the spring, summer or fall are languishing on the market.
If there ever was a time to try your hand at lowballing, this is it.
OK, here's the cliff notes version: It's a numbers game yet timing is also crucial as well!
Also, you need to keep your emotions in check - once you start wanting a particular house too much, you are already in danger of seeing your lowballing strategy unravel.
If you are so inclined, here are a couple tips from veterans of the game.
Lance says it's a numbers game.
Low balling is a numbers game. For every 20 lowballs, a buyer may receive 5 serious counters, from which one bargain purchase materializes. This game is not for everyone. It involves time, sweat, research, and a high degree of uncertainty. A buyer may miss 95% of the time or more with this approach... But as Wayne Gretzky said, you miss 100% of the time if you don't take the shot.
Claiz says be prepared for a long haul.
Lowballing (or offering at significant discount to listing price) instrinically has no financial downside - but since it has significant discount, your chance of getting a house at that price is very very low. So you can say there is an opportunity cost involved. If you see houses as perfectly interchangable commodity, are not really time-pressed or location-pressed, and don't mind the process repeating years after years (which for some can be frustrating), lowballing is fine. At the end of the day, it all depends on how much you want that particular house.
Timing is everything, says gcbma.
Interestingly, on our last real estate deal, the listing agent bellyached so woefully that our offer was "too aggressive" (exact words) but we resisted going higher than we thought the property was worth and it was ultimately accepted. It's important to try to hit that sweet spot with price and timing if your reasoned offer is to be accepted. There are times when the seller's expectations are just too unrealistic, and you have to move on.
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