"The best definition I've ever heard is that 'lowball' is an offer that's so low the sellers can't contain themselves. They get angry," she says.
Monsour says she encourages buyers to offer at least 85 percent of the asking price because anything lower than that is "an insult to the seller."
Yet her disdain of lowball offers doesn't preclude a little pre-negotiation negotiation between herself and the seller's representative in lieu of a formal written offer. The agents verbally agree on a price that's close enough to open a formal negotiation with the proviso that that price may be adjusted as the terms of deal, which Monsour calls, "bargaining tools," are discussed. This approach can move a lowball offer into a price range that's acceptable to the buyer and seller. The strategy works in part because Monsour, like most real estate agents in Florida, acts as a transaction broker who has no fiduciary duty to either the buyer or seller, but instead aims to bring the transaction to fruition.
Sounds like the "pre-negotiation" discussion between agents could be construed as collusion by some folks.....
.... agents feel each other out all the time..trying to get a feel of where the sellers head is and their motivation.... agents present verbals to sellers all the time. Some buyers are coming in with rediculously low lowballs, but by law we have to present them. Even on "low, low listed foreclosures...buyers come in at 50 to 70 percent of foreclosure or short sale price.
I think that what is lowball in one market may not be lowball in another. In our market, homes typically have been priced close to fair market value -- so offers of 97-98% of asking were the norm before the "downturn". Now if a home is priced at fair market value, we're seeing that homes are selling for about 95% of asking. So what's the magic number in my market that would be considered lowball?
Originally posted by real estate lady: ....now only you would think that.
....now only you would have us believe agents are not motivated, by commissions, to have the house sell at the highest possible price
I don't think agents are motivated to sell at highest price for the most commission. I think they are motivated to find a price that both parties will accept. Remember % varies for each house, a higher priced house may pay less commission. They try to bring up the buyer, bring down the seller. Closing is the goal...
Posts: 945 | Location: Southern CA (Southbay) | Registered: Nov 08, 2005
Because the agent has no fiduciary duty there is nothing wrong with what they are doing, though buyers and sellers need to protect themselves and be aware of this fact before contracting the agent.
In California, where the agents will have fiduciary duty to someone in the transaction this pre-negotiating would breach fiduciary duty if revealing any information that is not in the clients best interst. That said, it clearly happens all the time.
Originally posted by caroeib: In California, where the agents will have fiduciary duty to someone in the transaction this pre-negotiating would breach fiduciary duty if revealing any information that is not in the clients best interst. That said, it clearly happens all the time.
Which is why I never tell ANYONE anything that I don't want EVERYONE to know. Why people discuss their personal life with an agent is beyond me. It is a business transaction, keep it that way.
Posts: 945 | Location: Southern CA (Southbay) | Registered: Nov 08, 2005
Sunny Daze that is too funny, we thought the same thing....that someone would come in here and lowball us...and then in turn, we would counter at like a million dollars. heheheh But instead, they lowballed us,and we accepted. LOL No games. I want out
I respond to high counters with a another reduction so it all works out, except I'm still free to shop for a better deal and you have holding costs for a another month or two until the next lowball comes in >; )
In California, where the agents will have fiduciary duty to someone in the transaction this pre-negotiating would breach fiduciary duty if revealing any information that is not in the clients best interst. That said, it clearly happens all the time.
If that happens, report the agent to the state licensing authority, s/he will lose their license, or better yet, pick a reputable honest agent.
***It's not my job to sell a house to my buyer, it's my job to find the right house for my buyer.***
Posts: 2394 | Location: Colorado Springs, CO | Registered: Jan 18, 2003
I have to say that Real Estate Lady is on the MBs quite a bit actually helping people and putting forth a great effort in providing very valuable information to alot of us. For me to admit that says quite a bit as I am attempting to do an FSBO. If she puts forth the effort in her real estate business as she does on here I would definitely want her to represent me. I religiously read the boards now and appreciate everything anyone writes; however, it is very noticeable that the ones posting negative information are doing just that.....ALWAYS posting negative information. I do have to agree that some agents are only in the business to collect the check in whatever manner they can. As far as thier commission, Buyers Agents are earning it more now than in past years. Having to show Buyers 30 houses before they "might" put a contract in on one takes alot of time, patience, research AND gas. In this market I can't imagine that any Buyers Agents would not do what is in the best interest for thier Buyers, negotiate well, research and actually try thier best to close the deal. I personally could not see paying a Sellers Agent $12,000 or more to do nothing more than what I am able to do except for networking with other agents and putting my house in homes and land. It was a personal decision that I debate every day whether it was right or wrong and it is not for everyone to take on. I have to overcome the FSBO stigmatism which is difficult. That being said, I do believe that some agents very much earn thier money and it is a shame that other agents give them a bad name.
Posts: 54 | Location: Maryland | Registered: Mar 22, 2008
I respond to high counters with a another reduction so it all works out, except I'm still free to shop for a better deal and you have holding costs for a another month or two until the next lowball comes in >; )
Why do you believe that no one can sell their house for asking or close to asking price or that it will cost them more if they don't take the first lowball offer. The seller may pay a mortgage or rent, they will do that either way, we all have to live somewhere. But it may cost them a lot more to accept a lowball offer when a higher offer is right around the corner. That lowball offer may be just that, a lowball that is not based on real value.
Posts: 945 | Location: Southern CA (Southbay) | Registered: Nov 08, 2005
agree most agents aren't 'motivated to sell at highest price for the most commission. I think they are motivated to find a price that both parties will accept.' BECAUSE the sooner they get a 'close' the faster their commission cks arrive.
watching a couple try to buy now,,, on an asking price of $1.8M, their offer was $1.3 which buyers accepted,,, then no deal - turns out the licensed real estate saleswoman VERBALLY got an agreement from sellers so there was no legal offer & acceptance nor earnest **$ - either 4 stupid or ignorant parties,,, if it ain't in writing, it ain't worth a bucket of warm ****,,, real estate & politics're both blood sports.
i believe the most serious problem in real estate today's ignorant or stupid buyers & agents (despite licensing rqmts),,, i hold sellers' feet to the fire - no one's forcing 'em to sell.
A sellers' agents job is to get the highest and best price. The buyers' agents job is to get the lowest price..and hopefully they meet somewhere in between and everybody is happy.
Sometimes sellers won't budge and sometimes buyers won't budge. It's not agent's fault.
