What’s a low ball offer in real estate?
4 min read
Asked by: Tamara Brown
By strict definition, a lowball offer is one that is significantly below market value. In practice, an offer is considered “lowball” if it is significantly below a seller’s asking price.
What is low ball offer?
Key Takeaways. A lowball offer refers to an offer that is far less than the seller’s asking price or is deliberately too low, as a means of starting negotiations. To lowball also means to throw out a purposely lower than reasonable number to see how the seller will react.
When should you make a low ball offer?
“After 8 to 45 days on the market, a home is likely to sell for asking price.” But after this time frame, Matthews says a home will usually drop in price and this is an appropriate time for a lowball offer.
How do you present a low ball offer?
Winning Strategies for Lowball Offers
- Find Out the Seller’s Motivation. If you don’t know why the seller is selling, you can’t meet their needs. …
- Write a Clean Offer. …
- Always Counter the Counteroffer. …
- Divert Attention Away From Price. …
- Give a Logical Reason Why Your Lowball Offer Is Fair.
How do you respond to a lowball offer?
Here are five tips for responding to a lowball offer:
- Don’t be insulted. Emotion tends to drive most of our decisions; we use logic to justify them after the fact. …
- Respond gracefully. …
- Write a strategic counteroffer. …
- Expect a counteroffer to your counteroffer. …
- Negotiate other terms.
Why would a seller take a lower offer?
If the sellers are looking to maximize their profit potential in today’s hot market, your low offer will likely be ignored. On the other hand, the sellers may be more receptive to taking less if they’re facing a financial crunch, if the property was inherited or they’ve already closed on another home.
Do low ball offers work?
A lowball offer typically falls well below the asking price. Potential buyers make lowball offers as a way to begin negotiations for a home, and they rarely expect the seller to actually accept the offer. Instead, the offer lets the seller know the buyer is open to negotiating a final price. Agents Compete, You Win.
Can you offer 10 below asking price?
Start low
Around 5% to 10% below the asking price is a good place to begin. Make your offer in writing as there’s less chance for confusion and only offer more than the asking price if you know that someone else has already offered that much.
What is an acceptable low offer on a house?
When it’s reasonable to offer 11% to 19% below the asking price. If you’re asking for 11% to 19% off a home with a listing price of $300,000, you could save between $33,000 and $57,000. This kind of offer is acceptable in situations when some updates need to be made — but nothing too serious.
How much over asking price should I offer on a home 2021?
As with all negotiations, when you are making an offer on a house, start low. A good rule of thumb though is to offer 5% to 10% lower than the asking price. Don’t forget that sellers often take this into account and deliberately put their house on the market for more than they expect or would accept.
Should you respond to a low ball offer?
Acknowledge it’s a low ball offer
It’s important to be direct in the process, and acknowledge that you see the offer as too far under the market value. Don’t respond immediately; instead, let them know you’ll get back to them.
Should I respond to lowball offers?
After you’ve considered the whole offer and weighed the benefits of the concessions the buyer is willing to make, it’s time to prepare your counteroffer. You should always counter a low ball offer—it’s possible they were just testing the waters to see what you’d be willing to accept.
Should you accept a low offer on your house?
Typically, real estate experts consider an offer that is anywhere from 20% – 50% lower than the asking price a lowball. Should sellers accept these offers? Most real estate agents recommend home sellers to steer clear of lowball offers – or, at least, to counteroffer at a higher price.
Can I offer 20k less on a house?
However, there are exceptions, so as long as you are not absolutely in love with the property and can afford to let it go, it’s usually worth it to try for the lowest justifiable offer you can make, even 10 or 20% under asking.
