Likely, more than once in your life you will admit to “low-balling” or offering an obscene low amount for an appliance, car, or other item. How did it go? Sometimes the transaction may have gone through, but in many cases nothing may have happened. When considering Phoenix Homes for Sale, think carefully about making a low-ball offer.
In real estate the term “low-ball” is often associated with writing an offer that is significantly below the seller’s list price. In the Phoenix Real Estate market, an offer is consider a low-ball offer when the offer price is 10% under the list price. So, is low-balling a good idea? Here are a few situations to consider.
Consider a situation where the seller’s list price is significantly higher than the overall market. When a listing is significantly overpriced, the seller is either unrealistic about what the market will bear or the seller is unable to sell for less due to the debt owed on the property. In either case, the low-ball offer is unlikely to result in an accepted contract due to the unrealistic expectations of the seller.
However, in rare situations the low-ball offer may find a desperate seller ready to make the deal happen. Instead of reducing the list price incrementally over time and seeing increased showing traffic with a lower list price, the seller maintained the original list price and is worried the home will never sell. The result is a seller ready to take the first offer received. In this rare situation, the buyer with of the low-ball offer gets a great deal.
Now consider a situation where the seller’s list price is at market value or below market value when compared to similar offerings on the Phoenix MLS. If you like the house, low-balling is rarely a good idea. Many times the low-ball offer results in the seller being offended. Additionally, if the home is at or below market price the seller may be getting significant showing traffic. Since the seller and listing agent are aware of this, both are generally willing to wait for a more realistic buyer. As a result, the low-ball offer will not work.
Do you want to learn more about buying Phoenix Arizona Homes? Our Phoenix AZ Realtors can help. Call 480-776-5214 today and set up a buyer consultation.
Jamie,
Great article and very relevant to today’s market. I always tell my buyers that if they find the home they love, they should consider putting their best and final offer in first.
I Look forward to more posts.