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hackamada_the · Guest

Here is another scenario which happened to me. I've been on an open house but really did not like the house. Realtor was able to see this on my face. Realtor suggested me to make a lowball offer. I do not think there is anything wrong with that. I would just leave otherwise.

I think there could be many different scenarious when saying "make a lowball offer" is still a good thing for seller.

john p · Joined: 10 Mar 2006 Posts: 1820

Provided that the seller is on the same page, sure. If the seller is not aware of this, that is no good, because a buyer could give the impression that they weren't interested to see if the seller would tip their hand.

The buyer might want to see if the seller is motivated or not. If the seller is motivated, you'll see it advertised "Motivated Seller" on the listing, plain as day.

The selling agent has no solid basis for what is in the mind of the prospective buyer, so until they have the ability to read minds, they need to keep their pie-hole shut and represent the interest of the seller as discussed with the seller.

If the buyers really liked the place, and most likely a couple discusses the matter in private afterwards; if the selling agents communicates that the seller is motivated, the selling agent has hurt the seller's ability to get the price they are hoping for, so if they catch the selling agent, I would hope that the seller could sue for damages.

JCK · Joined: 15 Feb 2007 Posts: 559

hackamada_the · Guest

If a particular buyer is coming to see a property, obviously does not like it, does not even want to take any seller/agent contacts then why not to suggest him to make a lowball offer? Not publically to everybody, just to this one particular buyer. Especially if there are no any other offers. And hey, some of them can really read minds Smile

. It is easy to follow by strict rules but I am not sure this could make you a good realtor even in the eyes of seller.

I understand that some sellers do not want this to happen because they do not want to negotiate. This is a very respected position. One of the houses is on the market for 2 years and there were no any price decreases for last year. I guess it is better to say to you realter about such position before hiring him.

Do not bite me. This is just imho.

admin · Posted: Mon May 05, 2008 8:39 pm GMT Post subject:

john p · Joined: 10 Mar 2006 Posts: 1820

AgentGrn · Joined: 28 Sep 2006 Posts: 82

schadenfreude · Guest

If a property is overpriced by 30%, and an agent is able to get a lowball bid of -15% of asking price that the seller grudgingly accepts, you could argue that the agent has saved the seller 15% and perhaps months of waiting.

Almost any bid is better than no bid. I think many many sellers are still attempting to get within 1 or 2% of the absolute top of the market. To me, after a seven year 120% runup, that seems greedy. Many more sellers need to get burned before prices come down to what people can reasonably afford. The bubble really hasn't popped yet. When it does, the drop will be quite painful for some.

john p · Joined: 10 Mar 2006 Posts: 1820

I think you're right that things are overpriced, but if a babyboomer retiring who say has a $800 mortgage, if that, why would he or she sell you their place for 30% off? Where would they go? They can't rent for $800 a month, they can't even downsize for that. The only way is if they refinanced for junior's college, pulled equity out, and can't swing the new refinanced mortgage. If someone can demonstrate that this is a huge demographic, you've sold me, but otherwise, they'll just stay put, or move to a cheaper cost of living. I think a certain segment will do this, which would put downward pressure on house prices, but the uplift is the pent up demand and the growing cost of living increases these people on the sidelines are getting, increasing their affordability reach. I do not have data to understand the number of people in the two cohorts so I could be misjudging this.

What I do know is that house prices have dropped significantly since 2006, interest rates are about a point better, a year and a half of cost of living adjustments in buyers, and a lessening of a fear of a full blown recession. On the other side is the growing segment of babyboomers that need to retire, however, if the cost of living increases they might decide to work longer and stay in their homes. Additionally, you have ARM resets and the refugees from that, and the fact that the extend-a-arm reach that was made possible by crazy finance schemes is not extending as far as before. I'm looking at both sides right now for affordability, and the gorrilla issues are is Boston past it's prime as the Boston IT'er thinks, and how much of the correction is due to "exhuberence" ,will the downward psychology, herd behavior, create the market to drop beyond what the fundamentals support, and do we catch a serious economic cold and have a recession or depression? Further, will we get an Administration that wants more socialism we can't afford or Nation Building we can't afford? The devaluation of the US Dollar has made me think that our companies will be more competitive to export goods and services, as well as make the debt that most people carry feel less and less as inflation kicks in and wages adjust. Lastly, I think that there is safety in the herd if you're not totally on the extreme edges because by the time the politicians know there is a problem, a certain percentage have already been hurt, so if they put in government intervention to save the center of the herd, you might catch a break; hell the oil companies get them, the farmers get farm subsidies. I wonder if the responsible people actually get hurt in this... Is calculated irresponsiblity the right capitalistic move? I mean guys like Donald Trump and others walk the line about how much they can get away with, and write it off as being part of the game.

Right now, I hear a lot of people beating the war drum; one blog called bloggers "stringent cassandras" (which I had to look up to fully appreciate). Anyway, trying to do some body english to will your bowling ball out of the gutter can have an effect if you make enough noise and affect herd behavior, but keeping your eyes on the fundamentals is valuable because it will help you time when you strike. If people don't go for the neck now, the stickiness in the market might not turn potential energy into kinetic energy. A handful of aggressive people could help the herd right now, but I don't know if this current generation has that constitution; I know the echo-boom was the era where every kid got a trophy and an award and they like to be told what to do. If this current crop of buyers act together and collectively do not buy, it could create the drop that many want, but once that nice place gets into range to the little hen and she wants it, the tide couldn't stop that woman from getting what she wants.

samz · Joined: 19 Feb 2008 Posts: 102 Location: Medford, MA

john p · Joined: 10 Mar 2006 Posts: 1820

Absolutely, definitely keep you eye on that trend. Don't you wish you could beam something down over Massachusetts and find out how many of them they are? Occasionally I ask the clerk at WalMart if they've got one, but they don't (since last Wednesday anyway). You can get some Skynard there though.

In addition to that, I think you'll find "sanctuary retirement State's", meaning as unions and public salaries outpace private sector incomes, and neglected infrastructure gets worse, the tax burden on many citizens will get out of control, so it might induce a larger migration to a sanctuary state that has lower taxes. Hell, who knows, maybe Montana might end up being the place.

CJ · Guest

john p · Joined: 10 Mar 2006 Posts: 1820

I think your points are all solid. Any market has a million dynamics that apply in a million different ways. Allowing yourself the flexibility to search for and apply the relevant ones in any given situation with help you optimize your hand in this mixed market.

If you look at an auto worker, they did get a raise when you look at what they make (global products). Their service and product can be sold for more US dollars overseas because the dollar is worth less.

I wonder if you charted what a US median home was worth in Euros, in Gold, etc.

When you look at the trade deficit, think about that we gave China paper and they gave us stuff. We're now making the paper we gave them worth less by adding money and deflating the currency.

When you think about ownership rich think of owners of corporations pumping out 8 to 10 percent a year from a company while the workers get the 3% raises (if that, as you said). Guess what, if capitalism works the way it is supposed to, one of the 3%'ers will hang out his or her own shingle and put the fat cats out of business. When a company treats their employees like commodities and this is not the nature of the industry, good people will walk, and the companies with the good people will sustain the 8 to 10 percent and the weaker companies with the weaker workers won't survive. For a stretch of time, companies will learn the hard way, but when they can't keep up due to lack of competitiveness, they'll pay to keep the good employees because the good employees will make them richer.