Will they take $X for this home?
Where X typically equals 20 to 50 percent below the listed price.
Here is the only way I know to answer this question. It’s in multiple parts, please bear with me.
1) It’s not our listing: It is highly unlikely that the specific home you are inquiring on is listed by our brokerage. As I wrote back in December 2010 in Hi, I’m calling about your listing at”¦ (insert random address here) , this site shows virtually every listing in the Phoenix area Multiple Listing Service. At any given time, we carry about 50 listings. There are roughly 43,000 homes for sale or rent in the Phoenix metro area. That puts the odds of you Googling an address and it actually being a Thompson’s Realty listing at 1 in 847.
If it is not our listing, then we aren’t representing the seller (or property owner in the case of a rental), ergo I have no way of knowing what the seller might accept.
2) I can’t tell you that: Even if you beat the odds and are inquiring on a property that we list, I am not about to tell you ”“ the prospective buyer or tenant ”“ what the seller might accept. You see, if we are trying to sell a home, we represent the seller ”“ and the seller’s best interests. Our job entails many different things, but a primary function in representing a seller is to get them the most amount of money possible for their home. You the home buyer naturally want to purchase the home for as little as possible. Herein lies an inherent conflict between home seller and home buyer (and is a fundamental reason that single-agent dual agency ”“ where one agent represents both the buyer and seller ”“ is generally a bad idea). You both have the same ultimate goal, closing the real estate transaction, but you have very different preferred ways of getting to that point.
I can’t get my client the most money possible if I tell you the minimum they will accept. That would be serving your best interest, not the interests of my client. That’s why you as a buyer need your own agent representing you. The last thing a buyer should do is be working with the seller’s agent. Find an agent to represent you. (But don’t expect me to tell them what my clients minimum acceptable offer is. I won’t compromise my clients negotiating position.)
3) WWYD?: What Would You Do? Think about what you are asking. You want to know, for example, if the seller with that property listed for $200,000 will take $150,000. If it was your home and you listed it for $200K would you take $150K for it? (Let’s assume the house is listed at or near market value. And yes, that isn’t always a safe assumption. This is just one place where your buyer’s agent should be helping you).
I don’t think you would be willing to slice 25% right off the top of your sale. You, with the help of your agent, have determined that the market can support your asking price. While you should expect to negotiate with a potential buyer on price and other aspects of the sale, you shouldn’t expect to get shafted and sell your home significantly below market value. What exactly is “significantly below market value”? That depends on the individual. But I have yet to run into anyone willing to just roll over and accept 20, 30 even 50% below market value. And yep, there are people out there that seem to think they can get homes at that steep a discount.
It’s unrealistic. Yet it happens all the time.
So the next time you find yourself talking to who you think is the sellers real estate agent, stop and ponder. Remember: WWYD and we can’t tell you what a seller will take. And for goodness sake, get yourself an agent to help you out.
Photo Credit: Sumeet Basak on Flickr. CC Licensed.