Now is a great time for real estate buyers to get great deals on homes they really want, but you have to remember that sellers are invested in their homes. They are likely to feel insulted if you bid low on their home, which may result in such hostile feedback that you can’t make another bid. If you want to bid low on a home without offending the seller, some finesse is in order.
A motivated seller won’t be as offended by a low bid as a seller who wants to wait for the market value of the home. For example, if the seller has already purchased a new home across town, he might be willing to negotiate further in order to get it over with. You can bid low on a home without offending a motivated seller, but you have to tread lightly until you’re sure.
The same is true for a home that’s been sitting on the market for the last eight months. Home owners get frustrated when they can’t get any bites on their home, and will eventually reconcile themselves to a lower price just to sell. Check with your real estate agent to find out how motivated the seller is and how long the house has been on the market.
Market data is essential if you want to bid low on a home without offending the seller. Find out the selling prices of homes in the area of comparable size and quality, then adjust your offer to compete with them. This isn’t always a foolproof method, but chances are the seller’s Realtor has already made them aware of these facts. They might have priced the house high in anticipation of a lower offer.
Remember that houses are only as valuable as the market allows them to be. You can’t worry about offending the seller with a low bid if you’ll be overpaying for the home. Since this market is mostly in the hands of the buyer, sellers are more than willing to adjust their expectations in order to guarantee a sale.
You’ll be less likely to offend the seller with a low bid if you can cite specific reasons why your bid is less than what they might expect. Foundation problems, outdated fixtures, poor landscaping and other issues should be described along with the bid. It’s hard to imagine that sellers don’t know what’s wrong with their own homes, but this is often the case.
You can attach an explanation for your offer to the top of your bid, in the form of a cover letter. This is a thorough, respectful way to do business, and you’ll decrease the risk of offending the seller with your low bid.
Prepare for Rejection
If you make a low bid on a home and offend the seller, you might be shot down entirely. Some home owners won’t entertain lowball offers and will refuse to negotiate further, which is the risk you take. However, the seller might respond with a counteroffer, in which case you can begin negotiations from your own low bid. Real estate is largely a guessing game, and you do have to take a few risks.