Throwing The Low Ball

RealEstate Journal has some advice for home buyers looking to knock down a seller’s price. For one:

    • Check public records (like at RealEstateABC.com and Trulia.com) to see how much the owner paid for the property and when. Owners who’ve held the property for years have built up the most equity and have the most wiggle room on price. On the other hand, those who bought within the past two years may actually owe more than the house is worth.

The article also talks about seeing what comparable houses are selling for and looking for language like “willing to negotiate” in the house’s ad. With the increase of houses on the market, prospective buyers have more opportunity to get a good deal on their dream house. — BEN POPKEN

Tips on Making or Accepting A Lowball Offer on a Home [RealEstate Journal]
(Photo: amyadoyzie)

Comments

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  1. muckpond says:

    in a few states (indiana, for one), real estate sales prices are NOT public record. but if you’re working with a realtor, s/he should have access to all of that historical pricing info.

    heck, even if you know someone with access to an MLS they can help you out. might i suggest a bar with wifi and an open tab for the helper?

    not that i’ve ever taken advantage of that before….

  2. mac-phisto says:

    zillow has that info on most porperties – except in arizona ;). in most cases, you can access this at town hall or wherever the public records are held. some realtors will do the research for you, but not all.

    whether or not there’s wiggle room, don’t be afraid to low ball. i found out that the previous owner of my property bought it only a year before i did for $145,000 (thanks zillow!). he was asking $190,000. my first bid was $142,000 – $3000 BELOW his purchase price a year prior IN A HOT MARKET! i didn’t even think he’d respond, to be honest. but he did – $162,000. we went back & forth & eventually settled at $150,000. that was the most exciting few days of my life.

  3. jaredharley says:

    Our agent has this information for us when we bought our house last November. The previous owners were selling after only 2 years of living there, and thankfully we bought the house for what it was worth, not what they bought it for – unfortantely for them, they had to bring an $18,000 check to the closing.

  4. mantari says:

    I have that same ceiling fan.

  5. raybury says:

    Dumb question, but how do cash-out mortgages affect pricing information?

  6. mathew says:

    I’d beg to differ about “don’t be afraid to low ball”. If your offer is just insultingly low, you’ll come across as an asshole, and the seller will want to avoid doing any kind of business with you.

  7. MercuryPDX says:

    @mathew: I agree. I had one group of buyers not only lowball the price by $30K, but to ask for funds to make cosmetic changes based on their personal taste(!!!). I could tell that their agent was NOT comfortable even making the request. Since the market was good, I took great pleasure in telling the agent that “That’s too ridiculous to even counter on, and I suggest your clients look for a sucker elsewhere.”

  8. SpyMaster says:

    As Mathew and Mercury have said, some low-ball offers are so low that they *must* be considered as insults…and if you are the would-be buyer who makes that kind of low-ball offer, expect to be ignored from that point on. Nothing wrong with a low offer, but you have to be reasonable. Another point to think about is…if the realtor you have hired to sell your house takes an insultingly low offer seriously, you should give serious consideration to firing that realtor before he or she totally screws you.

  9. mac-phisto says:

    @mathew: what’s the problem? find a different seller. i low-balled 3 properties before i bought my house. all 3 responded. one response was “that’s too low to entertain”, but they gave me a counter-offer when i raised my bid $15,000. still wanted too much for that house though.

    i should qualify my idea of low-ball though. i was low-balling offers by $40-50,000 on homes $175,000-$215,000. this is mostly b/c i was following sales in my area & know a few realtors & some of their tips & tricks for getting sellers what they’re asking. for example, MLS-listed properties here are bloated by ~$20,000.

    also, don’t plan on low-balling a home that is new on the MLS. you need to find the ones down at the bottom that have been sitting there for 3 or 4 months – that usually means the owner’s stuck in a 6-month contract & hasn’t had a bite in 4-6 weeks.

  10. chickymama says:

    @mac-phisto:
    Agreed. My husband and I are currently getting pre-approval before we go househunting. There is one house that I have seen (and love) that has been on the market for 9 months with no offers and has only been shown five times by the listing agent. Why? Renters. The renters were never there to let buyers come in and look. We were fortunate to get in and take a look.

  11. mac-phisto says:

    @MercuryPDX: that does sound ridiculous. one thing you absolutely have to know about low-balling is that you will have almost zero room for allowances after the inspection. & cosmetic changes? did they actually want you to do their move-in work for them?!? “yes, i’d like it $30K cheaper & please be sure to paint the walls eggshell before you leave”. heheh.

  12. katinka says:

    In our city (New Jersey), the sales price is part of the public record, and is online at the clerk of court office’s site. This is also where you can find out how much someone’s mortgage is and if they have refinanced to a new one, if you are wondering if they would have to bring cash to the table.

    While it sounds like the people who have commented here live in places where the market is still humming along and lowballs are insulting, there is a blog here that runs a regular post type thing of lowballs and what the percentage is off. Some of them are really surprising, like original list price 899,00, sales price 500,000??

    http://njrereport.com/index.php/category/lowball/