Crafting a strategy prior to writing an offer is essential in today’s market.

By
Real Estate Agent with Better Homes and Gardens Real Estate Metro Brokers

Writing an offer correctly is essential to getting the deal done.Every buyer is different. And every buyer has different needs, wants, and expectations when it comes to purchasing real estate.

So when it’s time to write an offer, it is very important to craft a strategy that addresses each client’s individual preferences.

The first question I ask the buyer before beginning is this:

“Is it more important to you that you get this house or that you get a great deal?”

The reason that I start with this question is that I am putting the buyer on notice that I will respect their wishes regarding the offer, but there may be consequences resulting from “going for broke.”

Because if they really want the house, the first offer must be strong enough to deter the seller from seeking additional offers from competing buyers.  Sellers will generally negotiate in good faith with reasonable offers in an effort to quickly achieve a mutually acceptable agreement.

But if the buyer truly wants to “get a deal,” then I make them immediately aware that they are risking losing the house to another buyer. The important thing is to let the buyer know that they probably won’t be able to “steal” the house and it may be very difficult to repair any burned bridges.

I have seen many buyers lose great houses that are tremendous bargains for less that a $50 per month difference in the mortgage payment. In many cases they wind up settling for less later on or they give up their home search completely.

And it’s sad to see a lost opportunity, and to ponder on what might have been.

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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Ryan Case 09/23/2010 11:06 AM
  2. Brian & Marie Spray 09/23/2010 11:08 AM
  3. Nancy Milton Holtzscher 09/23/2010 04:00 PM
Topic:
Home Buying
Groups:
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The Lounge at Active Rain
Realtors®
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offers
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Rainmaker
420,999
Leslie Ebersole
Baird&Warner Fox Valley - Saint Charles, IL
BRIX Group

Margaret is right, so many people who will say they want the house of the dreams at the price of their dreams. Asking which is "more important" at the beginning might straighten out the thinking, at least a little. Good idea to call it the "buyer's strategy" 

Sep 23, 2010 11:27 AM #23
Rainmaker
1,817,803
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

Motivation of the buyer is crucial to the way we write a PA.  It makes a difference as to what info I go over with the buyers.

Sep 23, 2010 11:32 AM #24
Rainer
11,142
Jeremy OnullNeal
Corona Realty - Corona, CA
Corona Real Estate Expert

Great Blog Post. I find that after a buyer loses 1 house because of trying to get that deal, it validates everything I told them and then they are more open to listening to my advice.....Funny how buyers act like children:)

Sep 23, 2010 11:36 AM #25
Rainer
73,244
Pam Pugmire
Silvercreek Realty Group - Meridian, ID
Meridian Idaho Real Estate

Richard~I know when I first was licensed, I thought it was my job to get every buyer a 'killer deal'.  Then I learned to listen to my clients.  I still want to see them get the best deal possible, but I also know that I need to work for them in accomplishing their objectives.  If they want a particular home, it's my job to help them get it!

Sep 23, 2010 11:47 AM #26
Rainmaker
396,556
Diane M. Phillips
Frankly Real Estate Inc. - Manchester, MD
Realtor 443-286-4365

Richard ~ I'll hang on to this one if you don't mind. Great tips & approach. Thanks for sharing it!

Sep 23, 2010 11:53 AM #27
Rainmaker
273,187
Bruce Swedal
Denver, CO
Denver Real Estate

Excellent points Richard. Often buyers will lose out on their ideal home because they find it too early in the process. Thinking they will all be like that one they low ball and press too much.

Wow that is either a really red roof in that picture or my color blindness is showing. Bright!

Sep 23, 2010 11:57 AM #28
Ambassador
904,650
Andrea Swiedler
Berkshire Hathaway HomeServices New England Properties - New Milford, CT
Realtor, Southern Litchfield County CT

Richard, I do like how you put that. Great way to lay it right out on the table!

(writing it down....)

Sep 23, 2010 12:04 PM #29
Rainmaker
744,243
Chuck Carstensen
RE/MAX Results - Elk River, MN
Minnesota Real Estate Expert

Definately a good strategy to use with buyers because they really dont think about all this when they are making offers.

Sep 23, 2010 12:10 PM #30
Rainer
69,845
Christa Borellini
Prudential California - San Diego, CA

Great post.  Yes this definitely happens too often.  I like the way you handle it!

Sep 23, 2010 12:37 PM #31
Rainer
15,001
Rayna Mckay
RE/MAX Real Estate Advocates - Calgary, AB

Great post. You really do need to bring that up with your buyers. I find that figuring out the difference in mortgage payments can really help with peoples decisions.

Sep 23, 2010 12:42 PM #32
Rainer
68,912
Phil Weaver
PRUDENTIAL - Quarryville, PA

Definitely going to use that question for future buyers.  It is a simple question that reveals so much about the buyer's motives.  Thanks for an excellent post.

Sep 23, 2010 03:35 PM #33
Rainer
11,497
Zakiyyah Newman
Re/Max Access - Philadelphia, PA
Philadelphia Realtor - (Philadelphia Real Estate)

Great post! You are absolutely correct. I am working with a buyer/friend now and this is exactly what I have been telling him.

Sep 23, 2010 04:28 PM #34
Rainer
173,323
Jim Shaw
Premiere Plus Realty Co. - Naples, FL
Real Estate Sales Associate, Naples Luxury Real Estate

Very good post, Richard.

 

Sep 23, 2010 05:15 PM #35
Ambassador
1,293,925
Erica Ramus
Erica Ramus - Ramus Realty Group - Pottsville, PA - Pottsville, PA
MRE, Schuylkill County PA Real Estate

I love that question you ask your buyers! Great phrasing.

I ask my buyers "If I come back and tell you someone else got the house, will you say OH WELL FIND ME ANOTHER ONE or will you cry?"

 

Sep 23, 2010 05:16 PM #36
Ambassador
1,320,627
Tammie White
Benchmark Realty, LLC (615) 495-0752 or www.TWRealtyGroup.net - Franklin, TN
Franklin TN, South of Nashville

Richard, I'm dealing with this issue right now.  Unfortunately, the buyer wants a great deal on a house that is perfect for them but the seller isn't budging.  Alas, they will probably lose the house.

Sep 23, 2010 05:42 PM #37
Rainmaker
1,033,910
Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC
Waters Realty of Brevard, LLC - Melbourne, FL
Personal Service, always.

Excellent points. You must know where you want to end up. Besides, getting a good deal is better than losing a great deal!

Sep 24, 2010 08:20 AM #38
Rainmaker
260,747
Bill Travis
Captain Bill Realty, LLC - Gilbert, AZ
Broker/Owner

Some buyers are just focused on getting a house at "their" price, and could care less about the small amount extra on the mortgage payment. They just want to win in the negotiation so they can tout how they negotiated such a great deal

Sep 24, 2010 09:33 AM #39
Rainer
35,754
Manuel Monserrate
Raleigh, NC

Richard, I think that question "“Is it more important to you that you get this house or that you get a great deal?” should become part of any buyer's interview, as it will definitely dictate the direction they go in.  With so many buyers approaching the process with no real thought of what they want, this could definitely get them started thinking of their goals in the first place.  

Sep 24, 2010 10:11 AM #40
Rainmaker
52,876
Angela Bond
Keller Williams Realty - Los Angeles, CA
Los Angeles Real Estate | 310 666 5052

Buyers can tend to become fixated on "how much they got off the asking price" - rather than recognizing a good fair deal is beneficial to everyone and especially themselves in the long run.  Finding that perfect home isn't always easy and I wouldn't let a few dollars a month more stand in the way of myself and my dream home.

Sep 24, 2010 05:39 PM #41
Rainmaker
263,070
Claude Labbe
Real Living | At Home - Washington, DC
Realty for Your Busy Life

Great way to pose the question.

However, it also is a good way for me to evaluate the buyer.  if the answer is "a great deal", that can be fine.  Now if the answer is really "the deal of the century", then I need to consider if this relationship is one I can commit to.

Sep 26, 2010 01:29 AM #42
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