real estate advice...please

[ridethatpony]

Neither my husband nor I have ever dealt with a real estate agent before.

We made an offer on a peice of property we are interested in. The agent, (after speaking with the owner) told us the owner said "not to come back, unless our offer was in the low 60's".

I realize agents make a commision off the selling price. And I think it would benefit the agent, to get the most money he can for the seller. But this new price "low 60's" is about 15,000 more than our offer. And I sure would hate to spend the additional money, if the property could be purchased for 50k or 55k.

What are the propbablilites that we are being duped?

Or is this typically the way things go with an agent?


If some one told you "low 60's" what would you think....61k, 62k, 63k....????

Thank You

[citilivin]

make your offer. A licensed agent must present all offers.

[donsgal]

Originally Posted by ridethatpony

Neither my husband nor I have ever dealt with a real estate agent before.

We made an offer on a peice of property we are interested in. The agent, (after speaking with the owner) told us the owner said "not to come back, unless our offer was in the low 60's".

I realize agents make a commision off the selling price. And I think it would benefit the agent, to get the most money he can for the seller. But this new price "low 60's" is about 15,000 more than our offer. And I sure would hate to spend the additional money, if the property could be purchased for 50k or 55k.

What are the propbablilites that we are being duped?

Or is this typically the way things go with an agent?


If some one told you "low 60's" what would you think....61k, 62k, 63k....????

Thank You

I do not know real estate practices in Michigan. But I will share with you what they are in Missouri.

If you sign an offer the real estate agent is duty bound by law to present it to the seller. They have to do this in a "reasonable" amount of time (usually a couple of days). The contract is presented to the seller and, at that time, the seller must accept it; reject it; or give you a "counter offer". It must be in writing and signed. (Google "statute of frauds" contract law). NOTHING VERBAL is valid. Everything MUST be in writing and signed.

If you have signed an "offer to purchase real estate" then that offer should have been presented to the seller and you should have an accepted, rejected or counter offer. Demand that the realtor in question provide you with the sellers decision in writing or tell them you will gladly report their actions to the Michigan State Board of Realtors.

The realtor might have been passing along a legitamate message from the seller. But until you have the paperwork to back it up, for all you know this could be the realtor's lame (and unethical) attempt at soliciting a higher offer from you.

If you need to find out more about this, I would contact the BROKER for whom the realtor works. If she is a broker (heaven forbid), then I would certainly contact the local board of realtors, or state board of realtors to obtain a copy of the STATUTES for the state that govern real estate transactions.

It sounds quite fishy to me.

donsgal

[bloogrssgrl]

A little more information would help.

Did you put your offer in writing? If so, it needed to be responded to in writing in one of the ways donsgal mentioned above.

Is the real esate agent representing you, the seller or both? Do you have something in writing?

What is the asking price on the property? If the owner is asking in the low 60's, let's say $62,500, and you are offering $15,000 less, you are asking the owner to take a 25% cut off their price. Depending on the property and the market it is in, you might be asking a bit much.

Sometimes people jump to conclusions that the agent is trying to jack the price up in order to get a higher commission. But, depending on who the agent is representing, s/he has to abide by their directions. Chances are that the agent is being up front with you and the seller does not want to take such a cut yet. If you want to be sure, put your offer in writing. And make sure someone is representing you by getting a contract signed to that effect.

[deb]

Was it the owner's real estate agent or was it your agent? If it was your agent, do you have a signed buyer's agreement with him/her?

All real estate agents are working for the seller unless it is your agent AND you have a signed Buyer's agreement with them.

As for the real estate agent coming back and saying that the owner wants a price in the "low 60's", I would NOT be surprised if the owner did say that. Most folks selling property have a firm idea what they want to for the property. The seller may have come up with the price by themselves or real estate agent might have shown the "comparables" that sold for prices in that range. Either way seller's usually aren't pleased when folks give them a "lowball" offer and they won't bother to do a counter offer.

The house we eventually bought was overpriced when we first saw it. We liked it and wanted to make an offer for it. Our real estate -buyer's agent analyzed what comparable houses in the area had recently sold for and we ended up submitting a written offer that was a lot lower than the asking price. The seller ignored our offer, he never responded to it and the offer which was good for 10 days expired. We kept house hunting. Almost 3 months later, the seller drove to his real estate agent's office and yelled at her "where did those people go?" It was the middle of WI winter and no one had looked at the house, let alone make an offer! His agent called our buyers agent and ask if we were still interested and could we come up a bit in our offer. We came up a bit in our next offer and he countered the offer. After going back and forth, our final offer was finally accepted.

How did you come up with your offer price? Could it be too low? Real Estate agents look at recent sales of comparable houses/lots/etc and use that information to help choose an offer amount. If you aren't working with a Real Estate agent - a buyers agent, who can research sale prices then you may have made your offer too low.

You can either send the seller a newer price which is more than you like or you can walk away from the property for now. If the land really is overpriced, then it will take the seller a while to realize it and he won't be willing to negotiate. If the land is still available in a month or two then you can try sending a new offer that is only a little higher than your last offer and see if he reacts favorably.

BTW - We had a great experience working with a buyer's agent. She had been in real estate for 30 years, was the broker and a certified appraiser. She really wanted to help us buy a house. She spent many hours and drove across 5 counties with us to look at houses. Yes, she got a fee for her work, but as first time home buyers, the house we eventually bought was maybe 1/3 of the cost of the houses she normally worked on so her fee was 1/3 of what she usually got. If you aren't comfortable going through the process alone, then working with a buyer's agent it the way to go.

deb
in wi

[Maura]

I'm in Michigan and have bought and sold in Michigan. The agent must present your offer, in writing, to the seller no matter how low it is. The seller then accepts, rejects, or offers a counteroffer. This would be in writing. If your agent is not presenting your offer in writing, or is not coming back to you with a counter offer (specific dollar amount), then you need to find another agent.

This is the beginning of the season. If you want a good deal, wait until August or September, or look for foreclosures.

[Shadow]

Me and the wife have bought fixed up and sold several houses. We usually sell them our selves. We only do good houses in better neighborhoods, places people want to live.
Over the years I have had people come by look at a house and offer half or less just hopeing I was desprate to sell. I understand the practice, but I do not like to waste my time with this type of buyer. If they call back I just ignore them.
The owners want low $60, you said you wanted to be sure it could not be bought for 50 or 55, so that tells me you offered in the 40s very close to lowballing. If you know what the property is worth and you really want it make a reasonable offer and if it is turned down, keep looking. If you get a counter offer you can negciate. If you have insulted them you will be at a disadvantage. Good luck and happy hunting.

[Macybaby]

The agent should have tried to get the seller to make a counter offer. With out a written counter offer from the seller, you have no idea if the buyer actually said anything about the deal at all.

When we sold our place in WI, we got a very low offer, and my husband told the Realtor he was not interested. My husband also told the Realtor not to even bring him an offer below XXX. Then she wanted him to put in a counter offer at that level. He was insulted, and had no intention. The prospective buyer really wanted the property, but had "reasons" why they felt it was not worth what we were asking. My husband countered that they were "their" reasons, and really had nothing to do with the property (and that was true, it was why it wasn't worth as much to them, not why it was not worth that much).

The Realtors finally got the buyer to increase their offer, and my husband accepted it pending financing. Our Realtor promised she would continue to market the property in hopes of getting a better deal (Do not believe them if they tell you something like this!).

BTW- we are still dealing with the after affects of accepting that particular offer - 4 years later, but that is a different story.

If I sell real estate again, I will not consider any low ball offer unless the buyer has cash in hand. I would not even make a counter offer, as I would assume they were getting in over their head as it was. I will also never trust a Realtor's word again. If they tell me something, they better have written proof. In real estate, if it is not in writing, it is not valid.

Cathy

[davisdj]

We close this week on house number 11 (selling). We close next week on house number 12 (buying). We currently have house number 10 on the market in Alaska. So we've done this a few times. :-)

I suspect that the realtor in question is not doing anything unethical or nefarious. He just knows that the buyer is not going to entertain a lowball offer. Today's market is purely awful for sellers. We lost $20,000 on the house we just sold, and consider ourselves lucky to get out with that sort of loss. (It's the first loss we've ever had on any real estate we've ever owned.) We listed the house at almost 5 percent less than we paid for it two years ago, knowing that the market was down that much at least. The house then sat and sat and sat.

The buyer was our only offer - and his original offer was a full 25% below our asking price, so a total of 30% off what we paid. (And this is for a perfectly good house in a stable neighborhood, with no repairs necessary, in move-in condition.)

We refused to even counter. Our agent was hesitant to even tell us about it - I suppose she didn't want to hear the screaming. :-) We told her to tell the buyer's agent to go away unless he could come up significantly.

They did, and we ended up selling at a price about 10 percent off our original buying price. It hurt and we lost money, but it could have been much worse, and likely would have been had we waited for another offer.

One result of the buyer doing this is that he totally antagonized us. We have done absolutely nothing to accommodate him since. He had to move the closing date by three days (his request) and we are charging him for the additional interest we're having to pay on the loan due to that. There were things he and the home inspection guy didn't notice in the inspection - nothing that was a deal breaker, and nothing that was illegal for us to hide, but the sort of thing that we've always disclosed willingly to a reasonable buyer - just the kind of little things it's helpful to know about a house. We aren't telling him anything about anything.

I'll never forget our purchase of our house in Alaska. It was a FSBO - and the first time we'd ever dealt directly with a seller before. It went wonderfully well. We were reasonable, they were reasonable. In the end, the guy decided to throw in all the applicances, and added at the last moment a log splitter (we used it for 8 years and then sold it for a decent price when we moved) and all the wood in the woodshed. He could easily have charged us, and we would have paid him.

It's very easy to really anger a seller. If you have to do so (for instance, if the seller is being completely unreasonable), that's fine, but doing so unnecessarily doesn't gain you anything at all.

I hate lowballing and just won't do it.

Sally

[Nevada]

Originally Posted by ridethatpony

What are the propbablilites that we are being duped?

I don't think you're being duped, I think the seller is just being unrealistic. You seem very sure of the real estate climate in your area, so I suspect your offer is pretty close to the market value. You may need to move on and find another property that suits your needs with a more realistic seller.

[Mostie]

It doesn't seem that a whole lot is moving in Michigan, lately- I see houses, etc. all over the place for sale, dirt cheap-people are trying to sell and get out of Dodge, so to speak- I don't know if the land we bought would be considered a 'deal' or not (being originally from California, I thought it was a heck of a deal, lol), but we bought 10 acres of wooded acreage for 29,500--on a land contract- I guess that's steep in a lot of areas, and really cheap in others- but as far as what the real estate agent said to you, I would wait a couple of months and make another offer, close to the offer you already made- has it been on the market long? After it sits for a while and they aren't getting what they want for it, they may look at your offer in a different light, lol-

[agmantoo]

Can you close promptly or do you have to qualify for a loan? Do you have the escrow as cash? Do you have to meet a lenders requirement? See where I am leading? If you have circumstances that create an unusual condition that could benefit the seller you need to speak up. Communicate any advantage that you possess and then affix it to your low offer and then give a time duration that the offer is good for. For example, tell the seller you will put xxx dollars down nonrefundable and close in 30 days and that the offer is good for 72 hours and time is of the essence. All that is contingent that you could make it happen. Money doesn't have much value but it still commands attention.

[mnn2501]

I had a seller reject my reasonable offer once, then he had no action on his house for 6 months, he then called my agent and said he would accept my offer of 6 months prior.
I had already purchased a different property, but were I still looking I would have offered 5-10% less -- sometimes sellers think they have a gold mine, a bit of time with the property not selling usually fixes that.

[MarleneS]

Get it in writing. Your offer should have been done as a formal contract offer - and the very least the owner should have done is to have written "rejected" across the face of the offer and signed it.

It seems you already understand that a real estate agent works for his/her broker (might be one and the same), said broker works for whomever is paying the commission, usually but not always the seller. Legally the agent/broker works towards the best interest of whomever he/she is working for.

Make an offer of $61-62K and if this is in the ballpark the owner should come back with a counter offer of his closest acceptable price -- either way you will know it's probably time to let it go, if the amount is above what you can realistically afford to pay.

If you are borrowing money the lender will have someone appraise the property (you will pay for the appraisal but it will be the property of the lender)- to protect both your and their interest. If you are paying cash for a piece of property is best to hire an appraiser prior to making an offer.


Hope this helps.

Marlene

[davisdj]

We bought a house in Alaska about ten years ago (on the market now, BTW). We'd just moved up there, and knew next to nothing about the real estate market. There wasn't much of an internet presence then in real estate, and I didn't have easily available internet access, so we had to do things the old fashioned way.

We looked at more than 50 houses in the space of about a week. We nearly drove our realtor crazy. But at the end of that time, we had a feel for the market. I felt okay about buying when we'd gotten to the point that we could walk in a house, turn to the realtor and tell her the asking price, and be very close.

We then bought the first house we'd looked at. :-) However, we knew then that we'd paid a fair price, nobody got taken (neither us nor the sellers) and we were happy there for almost a decade. Furthermore, we paid our buyers their asking price. They'd already reduced the house significantly and we were comfortable with what they were asking.

Unless you really do some research (and often that involves looking in person extensively, because pictures and descriptions on the Net aren't always really accurate, and they often leave stuff out), it's sometimes hard to know if the seller is asking a reasonable price or is grossly overpriced. And in this current volatile market, that's doubly true.

Having bought and sold both in the last few weeks, I've been on both sides of the fence. It's brutal either way. Buyers feel like they're being robbed, as they watch their equity evaporate. Sellers are a little uneasy, for fear they will pay too much and the market will continue to drop (probably true).

If we could have waited to buy, we would have. It didn't make economic sense for us in our current situation, but it might for many people.

Sally