subject: How To Buy An Inexpensive Home [print this page] One of the best ways to buy an inexpensive home is to make a low offer also referred to as a low ball offer. This is a great way to know which sellers are motivated and to begin negotiations should they be. Most home buyers are afraid to use this technique however, thinking it is a waste of time if not accepted and embarrassing as they bid too low on the home.
One very successful real estate investor claims "If the offer you are presenting does not embarrass you then your offer is not low enough". Needless to say, this investor has made millions in the real estate market so I more than take the advice that he speaks. However, it is important to realize that most of the time, a truly low offer will not be accepted.
It is actually the opposite and most often will never be accepted. Is this to say that it is a waste of time? No, and the reason why is because often times the seller comes back with a counter offer and your low initial offer is just a way to alter expectations from the seller.
Buy a Home Inexpensively By Lowering Seller Expectations
Nearly everyone has had the experience of selling a car. And, unfortunately each of us have received those low ball offers. However, what this does, is condition us to accept less for the vehicle. When a potential buyer crawls underneath the hood of the car and then offers you half the price you typically do not accept it unless you are aware that your vehicle has problems but then become conditioned to accept less and hoping that the next potential buyer will offer more than the last.
The entire concept of a low offer is to lower expectations. If the seller is asking $250,000 and you offer one hundred thousand less is it likely he/she will accept your offer? No. It is almost certain that he will not. Buying a house for an inexpensive price is not that easy.
The flip side is this seller may counter offer with a percentage above your offer still making the house less than market value should you purchase. Say he counter offers with a offer of $200,000 and now you can again counter offer at ten to twenty above your last offer.
The downside of this technique is you will lose a lot of homes. Some sellers are offended with low ball offers and will not have anything to do with the potential buyer. This technique should be used when you have the time to find a home and want the best deal possible.
One investor in Dallas regularly made hundreds of offers on homes each month. He would not even look at the property prior to offering a bid. He would offer 25% less on the home than the asking price. Most sellers said no but occasionally he would have a seller accept. When this happened, he got the greatest deal imaginable.
