Why Do Buyers Think Cash Offer on House Justifies Low Ball?

[LoneRanger]

Never said clear deed meant anything to anyone except to me in the fact that it means I am not tied to a monthly outlay on the house and the only thing the home costs me to sit vacant is electric and natural gas bill. That's an average of about $130/mo give or take a bit for this time of year. Worst case scenario on utilities would be dog days of July and August when I typically, looking back over the 13 yrs I lived there, see the bill get closer to $200.

 

[Vuflanovsky]

Maybe it's me but I think we're well past the "don't get mad' part...just as blanket statements about what is and isn't a low ball offer aren't dictated by the fact there aren't other offers. In relative monetary terms, if a 10% under offer represents 40-50K under comps with certain demands for a turnkey property as described, you can probably feel comfortable that it's a low ball offer whether there's another offer or not. We're talking in platitudes and not in specific reality especially with the OP stating he's in no hurry with no special need.

 

[LoneRanger]

A deal has been reached and a purchase agreement has been signed.

Negotiations brought selling price to 96% of listed price. Buyer to deliver letter of certification on cash funds w/i three days. Was not an investor. Buyer represented by experienced realtor. Seller (me) represented by experienced realtor. I give ton of credit to the two realtors in getting this done. Could not have done this myself as FSBO. Buyer is getting a wonderful home. Mint condition throughout. 11 days on market.

 

[Wolf359]

Originally Posted by Sonic
Another thing we have done is get an appraisal as sellers to see what the house is worth before listing. This way you can save time deciding what to do with offers.


As I've said before appraisers are basically worthless when appraising a house. They're basically just hitting the numbers. They always know what the sale price of the home is as they always have a copy of the purchase and sale agreement which has the sale price in it, they're just working backwards to justify the price. Lots of times it would come in a few thousand above asking just to make every feel better. They have less experience coming up with a number with no data than real estate agents. Last guy who did one had no idea what the cost of a roof was, he asked me as I had just had it done on a property.

You're better off getting some estimates from several real estate agents and averaging the numbers. Those can also be off as some agents have a habit of listing a higher number. I've lost several listing presentations because the seller went with a higher number and then it sat on the market til it ended up selling at the number I had originally mentioned.

 

[pandus13]

Originally Posted by LoneRanger
A deal has been reached and a purchase agreement has been signed. Negotiations brought selling price to 96.7% of listed price. Buyer to deliver letter of certification on cash funds w/i three days. Was not an investor. Buyer represented by experienced realtor. Seller (me) represented by experienced realtor. I give ton of credit to the realtors in getting this done. Could not have done this myself as FSBO.


Congrats!
I wish you a smooth, headache-less transaction!

May I suggest for the $ 200 you would have consumed during summer to:
-Take you and wife to a nice dinner
-wash that vroom-vroom of winter's salt

 

[pandus13]

Originally Posted by Wolf359
...
As I've said before appraisers are basically worthless when appraising a house. They're basically just hitting the numbers. They always know what the sale price of the home is as they always have a copy of the purchase and sale agreement which has the sale price in it, they're just working backwards to justify the price. Lots of times it would come in a few thousand above asking just to make every feel better. They have less experience coming up with a number with no data than real estate agents. Last guy who did one had no idea what the cost of a roof was, he asked me as I had just had it done on a property.
...

In my case:
-$566 (???) more than loan/offer
-$2k-5K more than loan/offer
-we contested one based on similar properties in the 1 mile radius, while the appraiser find only one transaction, not even close to what we where buying

 

[hatt]

Originally Posted by LoneRanger
A deal has been reached and a purchase agreement has been signed.

Negotiations brought selling price to 96% of listed price. Buyer to deliver letter of certification on cash funds w/i three days. Was not an investor. Buyer represented by experienced realtor. Seller (me) represented by experienced realtor. I give ton of credit to the two realtors in getting this done. Could not have done this myself as FSBO. Buyer is getting a wonderful home. Mint condition throughout. 11 days on market.


Nice. I was thinking you guys could come together when everyone sat down and cooled off.

 

[hatt]

Originally Posted by Wolf359
Originally Posted by Sonic
Another thing we have done is get an appraisal as sellers to see what the house is worth before listing. This way you can save time deciding what to do with offers.


As I've said before appraisers are basically worthless when appraising a house. They're basically just hitting the numbers. They always know what the sale price of the home is as they always have a copy of the purchase and sale agreement which has the sale price in it, they're just working backwards to justify the price. Lots of times it would come in a few thousand above asking just to make every feel better. They have less experience coming up with a number with no data than real estate agents. Last guy who did one had no idea what the cost of a roof was, he asked me as I had just had it done on a property.

You're better off getting some estimates from several real estate agents and averaging the numbers. Those can also be off as some agents have a habit of listing a higher number. I've lost several listing presentations because the seller went with a higher number and then it sat on the market til it ended up selling at the number I had originally mentioned.

There are a few agents around here that ask sellers to get an appraisal before listing. They sell a decent amount of property. I don't understand it.

 

[Wolf359]

Originally Posted by hatt
Originally Posted by Wolf359
Originally Posted by Sonic
Another thing we have done is get an appraisal as sellers to see what the house is worth before listing. This way you can save time deciding what to do with offers.


As I've said before appraisers are basically worthless when appraising a house. They're basically just hitting the numbers. They always know what the sale price of the home is as they always have a copy of the purchase and sale agreement which has the sale price in it, they're just working backwards to justify the price. Lots of times it would come in a few thousand above asking just to make every feel better. They have less experience coming up with a number with no data than real estate agents. Last guy who did one had no idea what the cost of a roof was, he asked me as I had just had it done on a property.

You're better off getting some estimates from several real estate agents and averaging the numbers. Those can also be off as some agents have a habit of listing a higher number. I've lost several listing presentations because the seller went with a higher number and then it sat on the market til it ended up selling at the number I had originally mentioned.

There are a few agents around here that ask sellers to get an appraisal before listing. They sell a decent amount of property. I don't understand it.


That's very weird, that's their job. Even bank foreclosures will sometimes cheap out and ask for a BPO which is a broker price opinion. I've done a few in the past. Only charged about $50-$75. Normally you end up doing them for free.

Only reason I can see is that they think it's an independent number. Lots of times sellers always think their house is worth more. An appraiser might be the arms length number they need to bring them to their senses. For the seller side, that's where the realtor really makes their money, price it reasonably so the property will sell. You make nothing if it doesn't sell. That could take 1 hour or days. But that's the different between a 20k+ in commission sale and no sale.

 

[JeffKeryk]

Originally Posted by LoneRanger
A deal has been reached and a purchase agreement has been signed.

Negotiations brought selling price to 96% of listed price. Buyer to deliver letter of certification on cash funds w/i three days. Was not an investor. Buyer represented by experienced realtor. Seller (me) represented by experienced realtor. I give ton of credit to the two realtors in getting this done. Could not have done this myself as FSBO. Buyer is getting a wonderful home. Mint condition throughout. 11 days on market.


Well done. These things can be crazy, stressful, angering, etc.
All part of the game.

Again, well done.
BITOG to the rescue!

 

[hatt]

Originally Posted by Wolf359
Originally Posted by hatt
Originally Posted by Wolf359
Originally Posted by Sonic
Another thing we have done is get an appraisal as sellers to see what the house is worth before listing. This way you can save time deciding what to do with offers.


As I've said before appraisers are basically worthless when appraising a house. They're basically just hitting the numbers. They always know what the sale price of the home is as they always have a copy of the purchase and sale agreement which has the sale price in it, they're just working backwards to justify the price. Lots of times it would come in a few thousand above asking just to make every feel better. They have less experience coming up with a number with no data than real estate agents. Last guy who did one had no idea what the cost of a roof was, he asked me as I had just had it done on a property.

You're better off getting some estimates from several real estate agents and averaging the numbers. Those can also be off as some agents have a habit of listing a higher number. I've lost several listing presentations because the seller went with a higher number and then it sat on the market til it ended up selling at the number I had originally mentioned.

There are a few agents around here that ask sellers to get an appraisal before listing. They sell a decent amount of property. I don't understand it.


That's very weird, that's their job. Even bank foreclosures will sometimes cheap out and ask for a BPO which is a broker price opinion. I've done a few in the past. Only charged about $50-$75. Normally you end up doing them for free.

Only reason I can see is that they think it's an independent number. Lots of times sellers always think their house is worth more. An appraiser might be the arms length number they need to bring them to their senses. For the seller side, that's where the realtor really makes their money, price it reasonably so the property will sell. You make nothing if it doesn't sell. That could take 1 hour or days. But that's the different between a 20k+ in commission sale and no sale.

I just went back and looked up the Facebook post I remember seeing. She said up north they always get appraisal before listing!!!! It looks like an appraisal outfit is pushing the idea hard. One of their appraisers is "weeks away from their PhD!!!!!"

 

[KrisZ]

Originally Posted by LoneRanger
A deal has been reached and a purchase agreement has been signed.

Negotiations brought selling price to 96% of listed price. Buyer to deliver letter of certification on cash funds w/i three days. Was not an investor. Buyer represented by experienced realtor. Seller (me) represented by experienced realtor. I give ton of credit to the two realtors in getting this done. Could not have done this myself as FSBO. Buyer is getting a wonderful home. Mint condition throughout. 11 days on market.


Congrats and I hope the deal goes through without any hickups.

 

[JTK]

Mad about that? Sheesh.. I've had so many shenanigans happen from potential home "buyers", I'd call that a good thing asside from the realtor having you drive in for it. People are interested.

 

[LoneRanger]

Originally Posted by JTK
Mad about that? Sheesh.. I've had so many shenanigans happen from potential home "buyers", I'd call that a good thing asside from the realtor having you drive in for it. People are interested.


^^^ This is what happens when you only skim a thread. Few posts up from here I denoted that a deal was reached, and the home sold for 96% of list price.

 

[alarmguy]

Kind of a good feeling now, all cash, instant approval, no wondering if financing will go through.

 

[JTK]

Originally Posted by LoneRanger
Originally Posted by JTK
Mad about that? Sheesh.. I've had so many shenanigans happen from potential home "buyers", I'd call that a good thing asside from the realtor having you drive in for it. People are interested.


^^^ This is what happens when you only skim a thread. Few posts up from here I denoted that a deal was reached, and the home sold for 96% of list price.


I wasn't trying to be snarky, but you know I didn't read that tidbit later in the thread how?

I was still hung up on the fact you were upset someone made an offer. My point was, there's so many more annoying things that happen with this process.

Anyway.. Best of luck with it!