Maybe you’re purchasing your first home and aren’t sure of the best strategies toward having your offer accepted. Perhaps you’re looking to try out some new techniques to score the property of your dreams. Whatever your goal, there are certain negotiation strategies that tend to do more harm than good in the world of real estate. One of the most prominent examples is providing “lowball” offers.
What Does It Mean to Give a Lowball Offer?
When you’re providing a seller or their agent with a lowball offer, you’re offering far less than the asking price.
Some buyers may assume that, in the worst-case scenario, the seller rejects the offer and they continue to negotiate. But this isn’t the only risk that comes with giving lowball offers. Sometimes, lowballing can do serious damage and cause you to lose out on a property.
One of the most notable reasons for this is simple: When you offer far beneath the value of a property, you’re demonstrating that you’re not a serious buyer. If you’re not seriously interested in the home, then why should the current owner continue to negotiate with you? Some homeowners or agents might even consider lowball offers to be disrespectful, which can damage their perception of you, as a potential buyer.
Should You Still Negotiate on a Property?
Even if lowball offers are rarely accepted by home sellers, that doesn’t mean that buyers need to give up on negotiating, altogether. It’s still a good idea to negotiate the price of a home, if you’re doing so responsibly and aren’t giving offers that are far below the asking price.
If you’re looking to negotiate, make sure that you have an experienced real estate agent on your side. Your agent has the skills and knowledge to negotiate effectively on your behalf, even if you don’t have any experience doing so.
Your realtor will be able to do in-depth research on the property you’re interested in, allowing them to determine how motivated the seller truly is. They could even compromise and give an offer that’s on the lower side, while also offering to take the property “as-is.” In any case, your agent can determine the more effective negotiation technique for a specific home.
Home-buying can be difficult, especially if you’re going about the process on your own. For more information on negotiation, hiring an agent, and more, reach out today.