Low Ball Offers

During the past two years of working in the Las Vegas real estate foreclosure market, I have seen many offers that were ridiculously low compared to the list price and the comparables. I’ve seen them as low as 25% of the list price. Usually, they come in tens of thousands under list. Guess what? I’ve sent out rejections from the sellers for every single one of them.

I understand that offering $400,000 cash on a $450,000 listed property is reasonable, and I have seen these offers successfully get accepted and close. However, buyers and their agents need to know that the sellers see many good offers from investors and owner occupant buyers alike. Many offers come in at or above list price. Why do you ask? Most of the REO sellers base their list price on BPOs (or Broker Price Opinions) and monthly reports. This means that most list prices should be very close to what will come in at appraisal.

Many of today’s buyers are very informed due to all the information readily available to them these days. However, buyers still need to rely on their agent’s experience, tools, and knowledge. Agents need to keep in touch with reality and need to take their emotions out of the equation when helping their buyers make offers. Agents should also be more informed with what is really going on in their real estate market.

If you are a buyer, choose your agent very carefully. You cannot afford to work with someone based solely on their personal relationship with you anymore. Today’s agent needs to have a different skill set than someone who was an agent in 2005. Please find a real estate agent with good and current experience and knowledge.

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