In a real estate negotiation, a buyer and a seller – through their respective real estate agents – go back and forth with the goal of agreeing on the best price for a house for sale. Both sides employ their respective strategies to ensure that they get a deal that is in their best interests.
But what if the strategy a buyer employs is throwing a lowball offer?
In a hot real estate market such as Boca Raton, FL, you as a home buyer should proceed with caution if you plan to make a lowball offer. There is a high risk of negotiations starting on the wrong foot or crashing before you could say, oops.
REAL ESTATE IN BOCA RATON
Boca Raton is a city on Florida’s southeastern coast with communities known for their lovely beaches, sprawling golf courses, an eclectic dining and retail scene, and vibrant nightlife. Residents represent all areas of the generational spectrum from young single professionals to retirees. The cost of living may be higher here than the national average but electricity rates are much lower in Florida and the state doesn’t collect income tax. That’s why it comes as no surprise that this beautiful coastal city facing the Atlantic expanse draws in both tourists and those seeking a home in warmer climates. And with the ongoing movement of people to Florida, particularly toward its coastal areas, the demand for housing in Boca Raton is not likely to waver despite fears of an economic slowdown.
THE PROPER WAY OF MAKING AN OFFER
The general rule of thumb is offering 5 to 10% below the asking price, but anything beyond 20% below can be considered a lowball number. Most real estate agents would usually advise against lowballing because sellers are most likely to reject it. At most, a buyer can enter the negotiation with an offer that may be less but still close to the seller’s listing price.
Should you attempt to offer less on a house, look for these particular conditions:
- The holidays: Psychology dictates that sellers may be in a festive mood during this time – enough to consider or even accept low offers. The last quarter of the year is especially packed with one holiday after another. Sellers looking to offload immediately may be more receptive to lower offers.
- State of the home: If the home needs work, the greater the opportunity for a buyer to offer a lower price. Homes in disrepair that will not be fixed to market standard are bound to receive lower offers as buyers will factor in the expense and hassle of renovation.
- Duration of listing: If a house has been languishing in the market for too long (over 45 days), buyers can make an offer that’s lower than the listing price. However, make sure to know why other people are not keen on buying the property before making your own bid.
Remember, a lowball offer on a house only works when there are no other offers on the table and should be done if the property is one that you can stand to lose out on.
Are you in the market for a home in Boca Raton? Give me, Brian Scharick of Florida Exclusive Living, a call and I’ll be your able guide in your home-buying journey. Call 954.644.9118 or send me an email here.