Tuesday, October 6, 2009

NJ Real Estate: The Offer

by Laura Jacobus

Oh, so, congratulations, you got an offer!! You must have been a smart seller and understood the basic mentality of a home buyer. You did your homework and went to see the competition. You staged your home to be clean, clear of cluster, and welcoming. And of course, you were priced right!

Few sellers understand the value in pricing their home to sell, not to list, TO SELL! It is the homes that start high and sit and sit and sit, like stale bread on the shelf, that are the least successful in attracting a buyer. The pricing has more appeal than most can imagine.

So, why is the offer so low? What is this buyer thinking, that he can steal my home and all the money that I have put into it? That he believes that I am so desperate that I will jump at his dangling green carrot? Tell him to come back when he wants to play with my toys nicely.

Ouch. That low offer is hard on the old ego. The house becomes, in many cases like the appendage to the body. The personal insult is difficult to shrug off. This is the point where we need to move mentally into the position of the buyer. He has, by now seen at least 6-10 homes in your area and price range. Carefully look at the current list of available, sold and under contract homes in your area. Some may have sold since you listed, but many may still be out there. Evaluate with your agent, the current market and determine the mid point of this offer compared to your list price. If the midpoint is still way below your acceptable asking price, ask why. Invite the buyers agent to make a presentation and explain the buyers position. This is a very acceptable way to understand the personal side of the buyers story, and a good way to get your point across to the buyers agent as well. That agent knows if this buyer can really afford your home, as the prequalify call from their loan department told them where to shop.

This buyer obviously knew the price range he was shopping in. The average buyer "today" will put in an offer of 10-12% less than asking price. This may not sound like much on a pair of shoes, but on a price tag of $350,000, that 10% can be shocking. $35000 is a deep discount and you still need to make up for your broker fee, legal, and transfer tax, which all adds up to about 6%-7%.

The bottom line is, everyone wants to walk away feeling that he got a good deal. The seller needs to move on, with little or no remorse, and the buyer needs to feel that he did not pay full price. Finding that middle can get sticky and uncomfortable. It is important to remember that you will most likely meet this buyer at some point in the transaction. Establishing a mutual relationship is best for all parties involved.

In the end, you have the power to choose to refuse, or let go of the loss and know that you too will also be able to negotiate a good deal for yourself in your next home! The point to your sale is to move on and enjoy the next phase of your life...LET IT GO and don't take it personal!

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