| When it comes to buying property making an offer can seem
like a huge step. Whether you are buying your own home, or looking for
investment properties, it's important to get comfortable with making
offers.
You make or lose money in real estate when you buy, not when you
sell. The reason for this is simple; when you buy you can negotiate the
price (i.e. the price you pay is in your control) but when you sell, the
price a buyer is willing to pay is not in your control (i.e. you will
only receive offers at or below market value).
Getting used to making offers allows you to reduce the emotion
involved in the transaction; the more offers you make that are
unsuccessful, the less emotional you are about the outcome and the more
willing you become to make more offers.
Don't Be Afraid Of Making Low Offers
By itself an offer is not insulting, no matter how low it is. In
making an offer, you are simply saying what you would be willing or able
to pay; you are not actually saying you only think the property is worth
what you are offering. A good Agent will present low offers so that the
Seller is not offended.
Why would a Seller accept a low offer?
There are many reasons why a Seller might accept a low offer, such
as:
- They have already purchased another property and they need the
money from the sale to close the deal or they will lose their
deposit;
- The property has been on the market for twelve months with no
offers and the seller is desperate for any offer so she can move
into a new home;
- They are relocating and don't want to leave the property empty;
- They are leaving the country and need to sell before they go.
What these sellers all have in common is that they are highly
motivated, i.e. they have to sell.
When is a Seller likely to accept a low offer?
When a home is first listed for sale the seller is hoping to get
offers around the asking price. After a home has been on the market for
several months the seller becomes more desperate and willing to consider
offers that would have seemed unimaginable when they first advertised
the home for sale. As a buyer, the key to buying low is to understand
the Seller's needs. Discover the following key facts about the seller:
- Where are they moving to?
- When do they need to be in their new home?
- Why are they moving?
- Do they need to sell this home to be able to move?
- How much equity do they need from the home to be able to make
their move?
- What will they do if they don't sell their home?
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