Dear David,
We’ve been trying to sell our house for a few weeks. Our neighbour’s house down the street sold a few days ago; theirs is nicer than ours in some ways, and ours is better than theirs in others. Our agent thinks our home should sell for almost as much as theirs did, but we just received an offer that falls far short of our expectations. To justify the offer, the buyer’s agent suggested our home needs a lot of work, citing things we consider trivial or unfounded, like replacing 20-year-old windows. Is it worth moving forward with an offer like this? – OFFENDED
DEAR OFFENDED: I often tell clients that there’s no such thing as a bad offer, just an opportunity to work towards something great. In every real estate transaction, we align parties that start off in opposite camps: sellers want the most money for their home, while buyers want favorable terms. In spite of this, magic still happens, and hundreds of thousands of properties change hands in Canada each year.
It goes without saying that many offers don’t come to fruition in their original form. You received an offer that was unsatisfactory, but now the agents can get to work hammering out the details. There is truly no such thing as a bad offer, since once you have an offer in hand, there is something to negotiate. Even a low offer provides a place to start, and a chance to make an even better agreement.
I’ve been told many of my peers read my column, and this next part goes out to them. It sounds like the agent representing your buyers is using an adversarial approach to justify their underwhelming offer, almost as if they were a defense attorney. But arguing for the sake of arguing does not add merit to the contract. From this experienced agent’s perspective, trying to make a case out of exaggerated deficiencies and non-existent issues makes it seem like you don’t know what you’re talking about. In real estate, you can’t compare apples to elevators. A single garage is not a double, a busy thoroughfare is not a quiet cul-de-sac, and a 2,000 square foot floorplan is not the same as having 3,000 square feet.
When an agent submits an offer that is obviously low, I’d far rather they come clean with their rationale, rather than trying to gloss things over with comparisons that miss the mark. Perhaps the buyer is shopping out of their price range and taking a swing just to see what happens. Maybe they are new to the market and haven’t yet developed a sense of what their money can buy. Some aspects of a property are measurable (ie. square footage), but others are hard to put a price on without market experience. Off hand, most people can’t put a price tag on the value associated with backing onto green space instead of a commercial plaza.
PRO TIP: Never be offended by a bad offer, it may be the first step towards consensus. With that in mind, making an unfounded case for an unreasonably low offer can start negotiations off on the wrong foot and keep a deal from coming together. Don’t base an offer on fabricated issues, as people can spot nonsense a mile away. #Advice #AskDavid #TheNegotiator
David is a top-selling Broker in Kitchener-Waterloo Region. He works personally with you when selling or buying your home. Call or text today for your free home evaluation! 519-577-1212.
