The Offer – Home Seller's Top 2 Problems and How to Solve Them
You’ve prepared your home for sale, rearranged your schedule around inconvenient showings and smiled through the annoyances of living in a home that is for sale. Now someone has made an offer and you’ve turned into a deer in headlights. Here are a few key things to keep in mind before you reply.
Problem #1: It Happened Too Soon
(If this does not apply to your situation, feel free to advance to the next point.) However, strange as it sounds, sometimes the worst thing that can happen for a seller is to get an offer right away. That little voice inside insists that you didn’t ask enough for it, right?
Just talk right back to that little voice and remind it that you spent a great deal of effort with your agent to select a price that would attract good activity early on. You have learned during this preparation phase that activity is highest during the first couple of weeks a home is on the market because buyers and agents are being emailed every morning with new properties.
These buyers have been looking for the perfect home, but haven’t been able to secure one, and they don’t want to miss out again. Getting an early offer is a sure sign that you have done something right. Take a bow.
Problem #2: (Say it with me) The Price Offered is Too Low
What did you do when you bought the house? Did you offer full price? Buyers are afraid of making a mistake. They’re being told by friends, relatives and probably total strangers to take 15% off the asking price with their initial offer. (The actual percentage varies, but you get the idea.) They are convinced it is a buyer’s market, so they are almost required to make a low offer, if only to retain their self-respect.
The thing to remember here is that it doesn’t matter where they start, it only matters where the negotiation ends up. You may be able to reach agreement with a couple of counteroffers, or it might take more; we just sold one that took 8, but it worked out in the end. The point is: it’s a process. Give them a counteroffer.
There are so many temptations to deal with here. That little voice wants you to counter as high as the buyer started low. Maybe the little voice is telling you to turn them down flat, (but you are smarter than that.) You know in your heart that if you don’t make a counteroffer, the odds are really high that you won’t sell the home.
At this moment, you don’t have enough evidence to decide whether this buyer is for real. They might be innocently testing the waters or they might have been making low offers for years because they are not in touch with reality. Either way, you are likely to figure out which it is only when they make their next move.
There is just one problem. In order to see their next move, you have to make one good enough to keep them in the game. While you can see whether they are for real in the 2nd round, right now is when they decide whether you are for real.
Your counteroffer should have more to do with market value than either the buyer’s offer or your asking price.
3 Possible Results
When you make a counteroffer, one of three things is guaranteed to happen.
- They accept it
- They counter it
- They ignore it completely
If you make a counteroffer with some relationship to market value, the likely result is the buyer will accept it or give you a counteroffer, probably one with some relationship to market value in return. Pretty soon, you’ve sold your home, and you’re on your way.
The bottom line is people don’t make good decisions when they are emotional, and too many sellers allow themselves to become angry when they get a low offer on their perfect home. Be insulted by all the people who didn’t make an offer on your home and remember that the person who did make an offer–such as it is–actually likes your home. See what you can do to inspire them to pay a nice price, and everyone wins.