Making a "low ball" offer

Update: Just got a call from the REA. Apparently, the vendor is willing to wait for us until today so we can make an offer in line with the "others". I think my suspicions are pretty much confirmed now. Who would do that?

Going to make a written offer in a few hours. Trying to decide between 315 and 320k. Or maybe waiting till tomorrow morning :p
 
How does this sound?


Hi <agent name>,

We have decided to put forward a formal offer to you for the above property.

We would like to make an offer of $315,000 for <address> with settlement to take place on <date>. This offer is subject to finance and our satisfaction with the contents of strata reports.

This offer will expire on <time and date>. Please forward this offer to the vendor for their consideration.

Regards,

<name>
 
Only make subject to finance if you really have to make it subject to finance - as it is a big turnoff if trying to negotiate a low price.

If you already have greater than 20% deposit (plus costs), secure jobs with no negatives, and the broker is fairly confident, then you "may" want to risk not including the finance clause.

I only say this because I personally would take a lower offer with no finance clause over a slight higher offer with it in today's market.
 
I am confident that we'll get finance (we've been assessed as being able to borrow a lot more than we are) however we have a small deposit. It's our first purchase so I wouldn't want to risk it in case something out of the ordinary were to happen.
 
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Offer has been sent. The nervous waiting has begun...

Really hope the REA doesn't call back straight away going on and on about the "other offers". It's getting a bit awkward :rolleyes:
 
Well I just got a response to my email followed by a phone call which I didn't answer. As expected, the offer was rejected but surprisingly (to me anyway) no counteroffer was made aside from the REA reiterating his "ideal" 330k price.

He also made a sarcastic remark about helping "preserve our equity" in another purchase (OTP) we made in the area which was more expensive. I will write a nice reply addressing that and ask that we be kept in mind if the vendor changes their mind. I would have made an increased offer (albeit small increase) but from the tone of his email, it doesn't seem like an inviting prospect.
 
If its worth 310 to 1 buyer, it's worth 320 to another, particularly if you have a long term view.

I think there would be a lot of sellers that would be prepared to wait for an outcome on a third offer in this market. They have probably already adjusted their thoughts on value anywhere up to 20% to be in the 'selling zone'...I hang out for it also.

If you really like it, are happy with the value in comparison to other properties you've viewed, why miss out for 5 or 10k. The number of people that had said to me...I coulda bought that if I paid a little bit more...or conversely...thought we paid a lot at the time but so glad we bought it.

Good luck with it
 
I think it's been established now that there were no other buyers that made offers. The agent has been acting far too pushy to make that even a remote possibility.

Thanks for all your feedback. I replied to his email yesterday and I will not be initiating any more contact. I have a good feeling that he will come back with a counter-offer in a matter of days/weeks.
 
I just got another call from the REA trying to "educate" me on the formula that is used for determining value of properties. Apparently, I'm wasting my time because every offer I make will be 20k below the acceptable level. :rolleyes:
 
haha - educate them on the fact that you don't give a **** what the 'value' is - you just want a good deal period.

That will shut them up!

Let them know you have other offers in your price range but would prefer this house only if you get it for the price you want.
 
cimbom said:
I just got another call from the REA trying to "educate" me on the formula that is used for determining value of properties. Apparently, I'm wasting my time because every offer I make will be 20k below the acceptable level. :rolleyes:
Click to expand...

I am with JWR, tell them not to worry about ringing unless it is to say "yes"

You are currently looking at other locations and don't really mind if they prefer not to sell at your price.

Thank the RE for his / her efforts and tell them you intend to make RE your investment field so may be talking to them again sometime in the future.

You may find next time you go to this RE they will condition the vendor buy saying "this guy will walk rather than raise the offer"
 
I think my last email did the trick. I just said that my previous OTP purchase has nothing at all to do with this purchase and if the vendor is willing to negotiate closer to my offer, then to give me a call. It will be funny to follow up in a week or two and ask how the other "offer" is going (hilarious that he alternates between having one and two other offers as well).

I guess being female, 26 years old (but look more like 20) and a first home buyer, he thinks he can get me to pay more by alluding to his "superior experience" :p
 
Great thread. Thanks for sharing this info. I put in a verbal offer three weeks ago. The agent laughed at me. Yesterday he called to ask me to get it in writing and he'd submit it to get the ball rolling. I'm laughing now. I set a limit, gave it, then walked away. Now he's chasing me. Good luck.
 
cimbom said:
I think my last email did the trick. I just said that my previous OTP purchase has nothing at all to do with this purchase and if the vendor is willing to negotiate closer to my offer, then to give me a call. It will be funny to follow up in a week or two and ask how the other "offer" is going (hilarious that he alternates between having one and two other offers as well).

I guess being female, 26 years old (but look more like 20) and a first home buyer, he thinks he can get me to pay more by alluding to his "superior experience" :p
Click to expand...

he's trying to close the deal before he heads off on holidays. expect a flurry of contact tomorrow, Friday and even Saturday. ask him what happened to the other offers, put him on the back foot.
 
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