Offer and counter-offers

[Erin Woods]

Imagine....3 properties in one line on the market for 3 months.

Offered $100k less than asking for each property as purchase in one line.

Counter offer of $50k less than listed price for each ad purchase in one line.

Went back and increased offer by $15k per property.

Vendor rejected outright.

Want to close.

Where to from here?.

 

[DaveM]

Offer more?

 

[Corey Batt]

The owner at this point may be sitting there looking at the current trajectory, rubbing his hands together until you offer at asking/above.

 

[Jamie_]

pay the extra 35k that they are wanting?

 

[AlmostBob]

Walk away is a very valuable negotiating tool
If you are the only offer
3 months:: to my mind; you are probably the only offer, in ↑$↑Sydney↑$↑

If you're set on this property
Make an appointment to view another property with the same agent

want to close: never be the one who wants the deal most, they lose $$
at least never be seen to be the one who wants the deal most

offer/counter still has to make fiscal sense to you, if the vendor is not reasonable, make a lower offer next month, it will still be there.

If all else fails, another member has a signature,
"The deal of a lifetime comes along every day",
make tomorrow's deal

 

[Big Will]

offer more (you might get it) or walk away (still might get it or you might find a better property).

 

[danwatto]

Offered $100k less than asking for each property as purchase in one line.

Counter offer of $50k less than listed price for each ad purchase in one line.
.

This could be your problem here - you are basing your offers on the asking/listing price.

The price on the ad isn't what the property is worth or even what they want. Agents underquote and overquote all the time.

Perform your own judgement of true value, using whatever resources (experience in the area, RP data, pricefinder, SQM etc) so you know how much it is worth to both the market and yourself. Factor in yield, definite improvements you can make etc.

Then go back and try and negotiate a bit under what it's true value to you is.

If your personal valuation and the vendors valuations can't meet, then you don't have a deal.

 

[danwatto]

If you're set on this property
Make an appointment to view another property with the same agent

That's the best way to make negotiation easier
If there is no pain to lose the deal because you have 10 more potentials lined up, you can be more patient and have the "nothing to lose" attitude.

 

[Brady]

What other info have you extracted?

Has there been any offers already?
- Likely has so ask the agent what they were
- Why werent the offers accepted, finance/amount/conditions/settlement date

Does the vendor have existing finance against the properties?

Does the vendor want particular conditions that will assist the offer
- Not always about highest price, could be no clauses, favourable settlement date.


$100k less then asking price, what sort of asking price are you talking. $1M for each 10% discount fair enough. $500k for each 20% discount pushing it, could be profit completely gone.


If you think they're only worth $X and that's where you are now then walk away.

 

[Cards]

Depending on your personal strategy.
Wanting large BMV discounts without any comparisons will offend most agents.

I like to keep agents on my side because its good business practice to do so.
Jump on RP Data & get some comparisons to use for your negotiation power & meet with the agent over coffee. You buy!

Explain your strategy ie.. Cash flow / Reno ect..ect... & get them on your side.

Also, If your strategy was to reno and sell ect.. - Offer the agent the listing once completed.
(Just dangle the carrot)

Create a Win, Win scenario in the agents mind!

But, always have your cut off number and never go over it.