"Bring All Offers" and "Price Firm" are NOT Synonymous! Lessons from the trenches

By
Real Estate Agent with Austin Texas Homes, LLC 453249

I have been selling homes full-time here in Austin for over 12 years now.  Part of learning any business is learning the lingo.  Here are a few examples:

  • "Needs TLC" or "Handyman Special" - In a nutshell, this means that you need some extra money set aside (possibly a lot of it) if you want to buy this property.  There will be a lot of repairs and/or renovations involved.
  • "Cozy" - More than likely, this just means "small". 
  • "Won't last" - More often than not, I see this phrase when the home has already been on the market a long time.

Speaking of which...

I am working with some clients who are purchasing their first home.  Needless to say, they are excited, and even more so because of the first-time homebuyer tax credit and low interest rates.

We looked at a good number of homes, then we found a home that seemed like a great fit for their needs.  It was priced within their budget, and it was larger than some of the other places we had seen.  For some odd reason, the home had been on the market for over FIVE HUNDRED days!  The listing agent put in "Bring All Offers!" in the MLS remarks.

Let me pause for a second here.  Along with the examples I gave above, "bring all offers" is a phrase that typically means "we are ready to get this place sold, and we are negotiable".

Without divulging too many specifics, we wrote an offer that was aggressive without being offensive.  The buyers asked me when we should expect a response.  I told them that since it had been on the market so long, the sellers probably had a pretty good idea of what they could do with regard to price, so we should hear something very quickly.

Instead, it took four days to get an initial response to our offer.  On day three, the listing agent told me that she was working on a "very reasonable counter" for us. 

So, what did this constitute? 

The sellers raised the price by $6,000 in order to cover some of our requested closing costs.  Overall, with their net price, they had dropped their price a whopping $900!  In case you couldn't tell, that last part was heavy-duty sarcasm.  My wife commented, "Wow - that's over $200 per day!"  Again - sarcasm.  We're kinda like that around here.  The listing agent told me that there might be "a small bit of room" on that counter.  We were about $16,000 apart.  I told her that we would probably just be looking for another home, and I later confirmed that with my clients.  Back to square one.

LESSON NUMBER ONE: If the price is super-firm, DON'T put "Bring all Offers!" in the MLS.  You are simply wasting everyone's time!  In this particular case, I can't imagine that this home won't join the legion of short sales that are out there already. 

LESSON NUMBER TWO: Set the appropriate expectations with your clients!  If it has taken 550 days, and you still don't have an acceptable contract in place, errors have been made.  Prepare your clients to garner the necessary resources to get the home sold.  I know they are bringing money to the closing and times are tough.  Tell them the truth!

Thanks for reading!

Photo courtesy of Zoomar.

      

 My RSS feed is http://activerain.com/jasoncrouch/rss

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If you're looking for a home in the Austin area, you can also visit my primary website at www.austintexashomes.com.  Thanks!

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Re-Blogged 5 times:

Re-Blogged By Re-Blogged At
  1. Patrick Schutte 03/31/2009 10:25 PM
  2. Jean Terry 04/01/2009 11:35 PM
  3. Yvette Gardner 04/02/2009 08:36 AM
  4. Kevin Heinrich 04/05/2009 07:31 PM
  5. Donald Bradbury 04/11/2009 07:11 PM
Topic:
Real Estate Sales and Marketing
Groups:
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Diary of a Realtor
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Tags:
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Rainer
28,574
Elena Martinovici
Professional Marketing Realty 602-321-1273 - Phoenix, AZ
Designated Broker- Phoenix , Arizona

Jason,

Well if they had the money to pay for 550 days of mortgage then they aren't motivated for this kinda market. maybe if they wait 550 more the market will appreciate back to where it started at when agent took the listing... as bruce said : lifetime listing agreements lol.

Apr 02, 2009 11:19 PM #104
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Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 800-610-7253 DRE01267479 - Costa M

It sounds like the seller is not motivated enough yet despite the time on market or the listing agent has not effectively explained reality.

Apr 02, 2009 11:22 PM #105
Rainmaker
343,471
Dawn Maloney
RE/MAX Haven - Northeast Ohio Real Estate Specialist - Hudson, OH
330-990-4236 Hudson Stow Cuyahoga Falls Silver Lak

Ok, I guess I must admit I have been this listing agent a few times...I am positive other agents have felt this way about my sellers from time to time...but I know I can get it sold. Do I need a different set of seller standards or do I just like challenges? Probably a little of both :) Sorry it was frustrating - the agent is probably positive he/she can get it done, too, and now all this time is invested.

Apr 02, 2009 11:34 PM #106
Rainer
8,636
Cheryl Kurek, B.Ed.
RE/MAX ELITE - Sherwood Park, AB

Here in Alberta, I have had great success with "Handyman Special". It tells it like it is. The trick is to price the property so that with improvements made, you can sell it again on the open market with a good 20-30K profit. The market has to be healthy, though.

Apr 03, 2009 12:02 AM #107
Rainer
8,636
Cheryl Kurek, B.Ed.
RE/MAX ELITE - Sherwood Park, AB

And, there is no excuse for a house to be on the market that long. Where is the expertise of the listing agent? That's where FSBOs get the idea they can do it better.

Apr 03, 2009 12:06 AM #108
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Rich Jacobson
Keller Williams West Sound Realty - Poulsbo, WA
Your Kitsap County WA Real Estate Broker

The term 'Motivated Seller' seems to have a rather diverse range of definitions!....

Apr 03, 2009 03:37 AM #109
Rainmaker
403,127
Sonya Loose
Gladwin MI Real Estate (Homewaters Real Estate) - Gladwin, MI
Wixom Lake, Secord Lake, Sugar Springs and Smallwo

Actually tyring to work a deal very much like this right now.  The house is on the market for $192,000 should be about $165,000 high end.  My clients offered $143,000 (not unreasonable if the house were actually listed at market value).  I'm told the sellers were ticked about our offer and don't even want to counter.  Well, it will probably be on the market for another 2 years and in the meantime my clients will find another great cottage to purchase!

Apr 03, 2009 06:51 AM #110
Rainer
31,268
Dale Falkowski
Remax Town & Country - Woodstock, GA
The Honest Agent Full Time Pro

Everybody plays the game different. Personally I like to call the listing agent and feel them out. You can tell a lot by voice inflection. If the sellers are motivated you'll know in about 30 seconds. If they aren't you'll know not to waste your time unless your buyers just love the place and have to have it.

If it's a slow day and you don't mind killing a few more trees go ahead and send the offer. Patience is the key to getting a good price no matter what. I made an offer on a house and the selling agent countered the next day at $900.00 below list price. I responded with, "when your seller gets real and drops the price $5k or more call me." 2 days later I got the email. "Seller will reduce price $6k, are you still interested?" Serious buyers can make offers on multiple properties. After all it is a buyers market! Right?

Apr 03, 2009 08:36 AM #111
Rainmaker
217,742
Patricia Beck
RE/MAX Properties, Inc., GRI, CDPE - Colorado Springs, CO
Colorado Springs Realty

In a buyer's market the sellers are going to have to come down more than $900 unless their home is priced very competively for the market in the area.  Now it is obvious why it has been on the market for so long!!

Apr 03, 2009 09:01 AM #112
Rainmaker
836,675
Lyn Sims
RE/MAX Suburban - Schaumburg IL Real Estate - Northwest Suburbs of Chicago - Schaumburg, IL
Schaumburg Homes

Well what are ya gonna do, welcome to the 'fantasy land' of real estate. I love the dog pic, was he negotiable? Best offer? All offers considered? Show and sell - that's the most stupid phrase they use, duhhhhhh.

Apr 03, 2009 11:48 AM #113
Rainmaker
128,117
Mike Henderson
Your complete source for buying HUD homes - Littleton, CO
HUD Home Hub - 303-949-5848

LOL.  The craziness of it all.  I thought I was a creative writer.

Apr 03, 2009 01:05 PM #114
Rainmaker
100,854
Mary Ann Daniell, Realtor Killeen Fort Hood Texas
Coldwell Banker United, Realtors - Killeen, TX

Jason - I know you know this, but those phrases are usually meaningless except for the rare occassion when they ARE true.   They draw in bargain seekers like bees to honey.  And shame on that listing agent!   No home should be on the market for 550 DAYS!!!!!  I'm wondering if the sellers don't want to sell but the agent needs the listing for sign calls???   It could happen!

Apr 03, 2009 01:59 PM #115
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Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

I have been on the buyer end of too many sellers that were hanging out in the time machine...  circa 2005.

Apr 04, 2009 10:01 AM #116
Rainer
37,313
Jerry Gray
Allen Tate Realtors - Winston-Salem, NC

Hi Jason,

I love the photo. It reminds me of an owner standing firm on the price. You can see it in their eyes. Great post!

Jerry Gray CRB, CRS / Prudential Carolinas Realty / Winston Salem, NC

Apr 04, 2009 10:25 AM #117
Rainmaker
1,108,853
Jim Frimmer
HomeSmart Realty West - San Diego, CA
Realtor & CDPE, Mission Valley specialist

I like how you and your wife use sarcasm with each other -- LOL. I had a similar circumstance two years ago except they dropped the price by $500. It took them another year to sell it after we moved on.

Apr 06, 2009 09:09 PM #118
Rainer
69,487
The Rains Team
Keller Williams Realty Atlanta Partners - Hoschton, GA
A higher standard in real estate

Hey Jason, The listing agent shouldn't have put that in the MLS if the seller wasn't willing to come down on their price--a waste of your and your buyer's time for sure! We should remember to be honest when writing our listing descriptions! Unfortunately for those sellers their home is just going to sit and sit and sit!

Have a great day,

Anne Rains

Apr 07, 2009 01:10 PM #119
Rainer
256,238
Debi Ernst
St. Charles County, Missouri - Prudential Alliance Realtors - O'Fallon, MO
GRI, e-PRO, Broker/Sales Associate

Jason - I don't think they really want to sell.  It's a good thing that you just moved on... :)

Apr 07, 2009 08:56 PM #120
Rainmaker
312,272
James Downing - Metro DC Houses Team REALTORS®, CRS, GRI, ABR,MRP, MilRes
Real Living | At Home - Washington, DC
When Looking to Buy or Sell - Make the Right Move

Crazy.  I just had a bank agree to 9k in closing by raising the list price 6k.  WOW....

Oh by the way - its been on the market over 100 days; but well - it has no kitchen.  I mean really - nothing but the walls with a gas line sticking out.

Apr 07, 2009 09:40 PM #121
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Debe Maxwell
www.AtHomesCharlotte.com | Savvy + Company Real Estate - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Hi Jason!  What a story!  I've had that same story in two parts but, can't say that I've had it altogether!  I do, however, KNOW you're right about the turn to short sale.  Some sellers just don't get it--you'd think after 550 days, they'd get it though, wouldn't you?!

Congrats on that little gold star!

Debe in Charlotte

Apr 07, 2009 10:32 PM #122
Rainmaker
660,997
Jim & Maria Hart
Brand Name Real Estate - Charleston, SC
Charleston, SC Real Estate

Hey, Jason. It is great to know that I am not the only one who feels this way. Thanks for sharing and I wish your clients well. Jim

Apr 08, 2009 09:59 AM #123
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