Selling house, low-ball offer received, need advice - long

[Bestwifeever]

I was thinking that too, Ziggy--I would lowball a for sale by owner listing too, assuming they were trying to save themselves the real estate commission but not passing that on to me. And as far as the seller is concerned, a buyer who can get financing is the same as an all-cash buyer, right (most sales are "all-cash" to the seller at closing, right?)?

I hope you get some serious lookers this weekend, Buckeye--your house and neighborhood sound great!

FD, DH is from a small town with hardly any residential turnover, and a lot of sales are simply word of mouth, never mind a realtor or a for-sale-by-owner listing--not always important to have a realtor and some people there are turned off by the two or three agents in town, while in our suburban area, you couldn't sell a house without a realtor.

[Buckeye]

FinanceDude - My listing in Realtor.com and in all of my other literature states I will pay a buyer's agent 3%. I have no problem compensating the person who brings me the buyer. I didn't need the help marketing the home so I went through a flat fee discount broker and did not pay someone commission to list it. Buyers' agents are worth every penny you pay them! I don't have the same feeling about listiing agents, especially the ones in my small town. An agent representing a buyer for my house can make as much on the sale of my home as on a typical sale around here ($150,000). If an agent is truly representing a buyer, she will be happy to bring me the buyer if my house is the one that fits the bill. We have made the buyer's agent's job easy because the home is in perfect condition and shows very well. No need for the agent to explain to the buyer why a little paint here and there and maybe some new carpet will make the home good as new. The buyer gets a beautiful, move-in ready home and the agent gets 3%. What's not to love?

I understand about what you are saying about the all cash offer and the proceeds of a loan being the same but we all know lots of deals are falling apart because financing cannot be obtained.

Bestwifeever - You are correct about the power of word-of-mouth in a smaller community. That's why we encourage anyone and everyone to come through the house during open houses and why we have had them virtually every weekend since putting the house on the market. Even if the looker is not qualified, they may end up standing next to someone who is looking for a house who is qualified. My next-door neighbor just told us he referred us to a guy he does business with who mentioned he wanted to move back into the area. My husband just went to pay our property taxes and the treasurer asked him how the selling of the house was going. The ladies at the post office gave him a bad time because the house is for sale and he's going to be moving away. The word is out!

We've made extensive use of Realtor.com over the years so I made sure we had a presence there. The couple we are negotiating with found us there.

[GoodSense]

Quote:

Originally Posted by Buckeye We have made the buyer's agent's job easy because the home is in perfect condition and shows very well. No need for the agent to explain to the buyer why a little paint here and there and maybe some new carpet will make the home good as new.

I would have to offer a different opinion. Buyer's agents do not like FSBOs even when they get paid the same amount. FSBO means the buyer's agent has to deal with the seller directly, instead of a fellow realtor. During a real estate transaction, emotions often run high. If there is no seller's agent, there is no "buffer."

Another reason that agents do not like dealing directly with principals they do not represent is that often the agent would have to put together the transaction for both sides, instead of just ensuring the buyer's side is running smoothly.

I am just saying in general that's what agents may think. Of course you sound like experienced sellers who know what they are doing, so your case may be different.

[Rustic23]

Here is a bit of information that most people do not realise.

"Only real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®."

Most folks, moi included, use the term Realtor for a real estate agent. When in fact if they are nt a member of the Nation Assoc. of Realtors they are not a Realtor.

[youbet]

Quote:

Originally Posted by Buckeye The counter-offer of $267,500 was faxed at 8:30 am and I have asked for a response by the end of the weekend. Happy to spend the time working on it and it is not considered wasted time in this market! I might have felt different if the offer came in so low and was not an all cash offer. Our turn to wait although the buyers didn't have to wait 24 hours for our response. Hopefully, another interested buyer will show up at Sunday's open house and we can make this real interesting!

I've never tried to sell a house in a slow market, so no real experience with what you're going through. However, it does seem like either this family will determine that your house best suits them of those available in the area and in the price range or not.

You've countered asking for approximately the appraised value so your home is not a "bargain." Now it's a matter of the folks making the offer deciding that the features of your home which are so attractive to you appeal to them enough to pay market or appraised price and do a deal.

How is traffic going? Open houses well attended? Any other offers?

Although the lack of a basement and the corner lot would be negatives for me, your house sounds attractive and hopefully will appeal to many buyers before winter sets in again......

Good luck!

[REWahoo]

Quote:

Originally Posted by davemartin88 Guess my point is they may be back but it would seem that a listing price that is well over what the house will appraise for might be a problem for most people?

Looks like that has been taken care of:

Quote:

Originally Posted by Buckeye Texas - I reduced the listing price to $279,900 about 3 weeks ago not long after I received the refi appraisal. The price on Realtor.com had been changed and I had stickers on my flyers in the flyer box that said, "reduced $20,000 to $279,900." The price was also updated on the house website, forsalebyowner.com, craigslist and zillow.com. I also advertised the new price and price reduction in our weekly county newspaper. I also had a "price reduced" topper made for our sign.

[davemartin88]

Quote:

Originally Posted by REWahoo Looks like that has been taken care of:

Oops, missed that! Deleted my post.

[REWahoo]

Dave, you should have left it. Except for that one paragraph it was good stuff.

[Buckeye]

youbet - The $267,500 was our first counter-offer. I expect (hope) to go at least another round. I did not want to give away the store on the first round but at least indicate we were willing to negotiate. We will go at least as low as $260,000 and possibly a little bit lower if it looks like we are approaching a number we can agree on that is near $260,000.

The whole thing is a bit interesting because dad (a successful CPA and owner of a beverage drive-thru in the neighboring town) is the bank for the deal so the adult children (I'll call them "the kids") may not be in total control of the deal. The kids may have decided the house is the one for them but dad my have to get the house at a huge discount and feel like he "won" in order to allow them to accept the deal. I'm hoping daddy will buy his little girl whatever she wants!

Normally, I wouldn't like a corner lot but our sub-division is at the end of a residential street so we don't get any thru traffic. The only traffic is from visitors and residents although when the weather is nice we get Sunday afternoon cruisers who like to come back and look at the beautiful houses. The lack of a basement is an issue around here but we have a huge three car garage (3 individual doors) and an additional 400 square feet on the second floor which we are marketing as our "basement up above!" I have attached a picture. If it was just about the space, the space is available but the word "basement" is part of the culture around here. I can't stand basements unless they are walk-out as I want a room to have at least some natural light. The land is very flat around here so there are very few walk-out basements. When I bought this house, the builder was living in and selling the house across the street with a 2-car and a basement. I was in-love when I saw the 3-car garage so I bought this one.

We have had visitors at every open house but we have not received any other offers. From the minute they arrived, it was obvious these folks were buyers. A whole different energy. Not taking this deal could easily mean we are in this house for another year so we are weighing all factors. The thought of actually having to move AGAIN (and to something not nearly as nice) keeps me from dropping the price just to ensure a sale now.

[youbet]

Quote:

Originally Posted by Buckeye . The lack of a basement is an issue around here but we have a huge three car garage (3 individual doors) and an additional 400 square feet on the second floor which we are marketing as our "basement up above!" I have attached a picture. If it was just about the space, the space is available but the word "basement" is part of the culture around here.

Basements are very popular here in the Chicago suburbs too. We benefitted from ours in two ways over the years. While we were raising the family, it was a large, indestructible place for kids to be in the winter where activities such as indoor soccer, floor hockey, mats on the floor for tumbling, etc., etc., were not only allowed but encouraged. Now that we're empty nesters, my workshop and hobby activities reside down there. A basement really can be quite useful, especially in areas with cold winters where heating the garage enough to do projects is tough.

I'd love to have your three car garage!

Is your additional 400 sf on the second level above the garage?

Good luck with the open house tommorrow!

[FIRE'd@51]

I would be very careful on any counter-offers you make going forward. If this couple really wants to "steal" the house, they can still walk away from a reasonable lower counter-offer. However the information that you were willing to sell the house for $xxx,xxx will probably be in the market place, so your lowest counter-offer will in effect become the new list price. You still have a little wiggling room since your current counter-offer is presumably for an all cash deal, but I would exercise some caution here if you really want to sell at a price somewhere near the appraised value.

[Buckeye]

youbet - The 400 square feet is located above part of the main house. There is space for storage over 2 bays of the garage but the ceiling is not high enough for living space like the 400 square feet. Here is the picture I forgot to attach. The men usually comment the space would make a good man-cave/media room.

[Buckeye]

FIRED'D - I'm definitely aware of what you are talking about with respect to details of this transaction leaking into the marketplace. Taking that into consideration affects how we work with this buyer to make the deal work. The BIL realtor (and he is a realtor) owns his own agency in Columbus which is far from our local market so there wouldn't normally be any communication with our local agents. Local chatter among families (and it seems like EVERYONE is related) is a whole other thing!

[Maurice]

Quote:

Originally Posted by Buckeye Accounting for the $308,000 sale price, we comp out at $264,000.

If it were me, I'd internalize this number as the best estimate of the market value of my home as of two months ago. The April sale of the pseudo-comparable provides new market information that was unavailable when you got the first two appraisals.

I would also recognize that its a falling market and would be willing to shave off an addition 5%, especially for a cash offer. That means I'd take 250k for the place.

[Buckeye]

Maurice - The February pseudo comp against the listing price of the April house had us at $264,000. Our May appraisal (by another appraiser) for the refi actually had the April house sale in it and the refi appraiser had us at $281,080 against it. Those are the only two appraisals we've had done. I'm not sure why you are recommending I use the $264,000 over the $281,080 as the starting point. Of course, the buyer doesn't care about any of this but I'm just curious about where you are coming from.

Also, the sales in our county have not gotten us tagged officially as a declining market like neighboring counties have been tagged. Again, the buyer doesn't care but our county has not been hit as bad as other counties.

[Maurice]

edit. sorry, i didn't catch the timeline. I thought all appraisals took palce before the sale.

[Maurice]

I'd still probably consider it a declining market, not withstanding what your CU guy said. You have hard evidence of decline - you paid more for the house than all of the appraisals. Do you have hard evidence of a rebound?

[Buckeye]

Maurice - I would say I have some evidence of a declining market and some evidence the appraisal wasn't completely arms length when I bought the property so I paid more for the property than it was really worth. It's a small town and all these people have known each other for a long, long time.

[Buckeye]

I received a call from the BIL agent to let me know the buyers have not yet decided on a counter-offer or whether they will bother to counter. If they really meant $232,000 and are not just positioning, I spent way too much time thinking about the amount of the counter offer.

[Maurice]

Probably just feeling you out. I hope you feigned indifference.