Making an offer off-market

[lazzaman]

Hello people, wondering if I could pick your brains about how to best make unsolicited offers ie for properties that are not on the market.

I am trying to purchase in a particular locale in order to relocate my business and there are only a handful of suitable prospective properties.
I have done title searches on these and need advice as to whether it is better just to register interest by mail (or in person?) or whether it is better just to make a pre-emptive offer in writing.
Not being very confident of either succeeding I want to try what might have more chance of success first up.

Thanks in advance


lazza

 

[fernfurn]

I have often thought I would put a letter in their box and say " if you ever decide to sell, and dont want the hassle of a re agent, please give me a call" and include phone no. This way it gives them time to think, is non threatening and they can even put it in a drawer for later use if they are even thinking of selling.

 

[steveadl]

I've done it by having someone send a letter on my behalf. If I'm just sending out random letters to strangers, my thinking so far has been I'd rather keep my name private until necessary - what are others thoughts on this?

ie. Dear Mr. Smith,
I am writing on behalf of my client who wishes to express an interest in making an offer for your property located at xxxxx (or making an offer for a portion of land on your property located at xxxxx).
If you wish to discuss this offer, please contact myself at xxxxxxx.
Regards,
etc.

I've done this a few times now. First couple properties I got no response, second time, they replied wanting more details, which I then provided through my guy. They then asked for a higher figure which I rejected, but left my original offer on the table (I already offered what I considered to be a premium for the land).

 

[buzzlightyear]

Would have thought that a big premium would be required to get current owners to think seriously about accepting an unsolicitored offer. And that is assuming they know what their place is worth.

I did it once to all owners (6) in a old block of flats in Port Melbourne in 2004with a very similar wording. Didn't receive a response.

If they are thinking of moving, then you might be in luck. Bit of a needle in a haystack type of chance though!

 

[steveadl]

Very true Buzz.

In the case I mentioned above, it was an already levelled block. I wanted to secure a smaller parcel of land from his existing holding, still leaving him enough land to develop the existing block into 2 new ones, which was his intention. He could have pocketed $xxx and still had two new houses, just with smaller backyards. Now he's just going to build the same 2 houses with bigger backyards but no lump sum of cash.

People can be funny when it comes to this sort of thing (although it makes it harder to judge when the market is moving fast). My guy said in his experience, people hardly ever respond to these unsolicited offers. He was quite surprised when we got a reply.

 

[lazzaman]

Thanks very much for your responses.
I am not at all hopeful but shall give it a go.

cheers

lazza

 

[MarkB]

Lazza

I gather from your first post that this is a genuine attempt to purchase in a particular area at a fair price.

That being the case, in your letter I think you should also offer to pay them valuation as determined by a valuer of their choice.

M

 

[tess85]

I've done it by having someone send a letter on my behalf. If I'm just sending out random letters to strangers, my thinking so far has been I'd rather keep my name private until necessary - what are others thoughts on this?

ie. Dear Mr. Smith,
I am writing on behalf of my client who wishes to express an interest in making an offer for your property located at xxxxx (or making an offer for a portion of land on your property located at xxxxx).
If you wish to discuss this offer, please contact myself at xxxxxxx.
Regards,
etc.

Who do you ask to send the letter out for you?

interesting thread. We are waiting for a townhouse in a very specific area to come up for sale... I wonder if it would be worth trying this out?

 

[steveadl]

The first time when I was only half serious and just guaging interest I used my PM's sales dept.

Another time when I was seriously interested in entering negotiations I had my accountant write out a letter. He then engaged in negotiations with the other side on my behalf during which I remained nameless the entire time.

Looking back, in the future I'll only be using a professional (not REA), I think it shows your intentions are more serious.

 

[tess85]

^^ what do you mean by a professional who is not a REA? ie. your accountant?

We are seriously thinking of going down this route after being *this* close to buying 2 places and not succeeding due to other highly motivated buyers...

 

[RumpledElf]

Round here you always used to see signs up in the shop window "House wanted. $10,000. Phone XXX XXXX". And people would get their house. Can't get much more unsolicited than that. I have no idea if the same tactic works in the city, putting up a notice in the local shop windows appealing for a house for a "nice couple seeking blah blah".

When this stupid property boom hit here every man and his dog has their house listed with the local crappy real estate agent AND the council is trying to sell off their repossessed houses - easily 15% of the town is for sale. And all for more than $40,000. So much for affordability, eh?

 

[steveadl]

^^ what do you mean by a professional who is not a REA? ie. your accountant?

We are seriously thinking of going down this route after being *this* close to buying 2 places and not succeeding due to other highly motivated buyers...

Yes accountant, lawyer etc. Puts a bit more weight behind the offer than just the local Century 21 office.

 

[Alabex]

Getting your solicitor or accountant is a great idea.

As agents we have done this a few times for clients, but it is difficult to stand out in the clients mail box with Agents logos all over it. We find the key is to make the letter more personal so it doesn't look like jsut a generic mail out/letter box drop.A brief single page letter on letter head in an envelope with a hand written note on the front, and not including any Real Estate crap- no free appraisal/offer etc. Being specific about why the client wants the particular area, house or unit helps. Also showing some knowledge of the property or area.

Suprising we have got a fairly good response to date. Only problem is often the premium they want to sell is more than the premium the buyer is prepared to pay.

 

[hightop]

Has anyone got any other experiences?

 

[Propertunity]

As Buyer's Agents we have done the same thing when looking to buy for a client who only wants a particular street.

I would tend to think that a BA might be better than an Accountant or Solicitor in this scenario (but hey I'm biased).