Torres Ramey

How much do I Offer?

Often I get asked from buyers and less experienced agents here in Mesquite, "how much should we/my clients offer on a house?" Well the answer is, depends. It depends on several things, first and foremost, what can you afford? Assuming that the home you are looking at is in your price range and with current market conditions the way that they are, you certainly are going to make a lower offer than the asking price. Yes, even if you absolutely love the house, don't like to make or receive counter-offers and/or need to be in a home right away. Why? If the sellers have an agent and especially if you are buying a house from a bank, they the sellers, by virtue of their agents or representatives' will be informed that no one ever makes their best offer the first time. Knowing this you and your agent should definitely make a lower first offer. Ok it's true there are times when the seller accepts the first offer and it is usually in the type of market that we are in now. However, I would submit to you that the reason they took that offer is because the buyer offered too much. The seller is now celebrating because more than likely they got MORE than what they wanted/needed out of the house.

You see when you make your first offer you are really trying to figure out what range or price the sellers really want/need to get out of the house. It's a "feeler" if you will. The exact amount of how low your offer should be truly depends on the area and market the home is in. For example, here in the southern part of Nevada, if you are not fairly close to the list price you will probably get a rejection! No counter-offer at all. I know some of you are thinking that's crazy, and your right, a seller should always make a counter-offer. Out here though, it's fairly common to get a rejection even in the market we are in. It should be said that the offers coming in are lower than you would see in a "normal" market but still not as low as you might think depending on what part of the country you're from. In other words instead of an offer being 10K low, they are 20k low now. That's not a big difference considering the current market.

Now the price of the house has a lot to do with what I am saying too. A higher dollar priced house is going to get a much lower offer than a single family home in the average price range for the market. Example... a home listed for 1 million would probably get a first offer in the range of 900k-950k. Whereas a home listed at 250k will probably get a first offer of in the range of 230k-245k. Another question I get asked all the time from buyers when I am representing the seller is, "what is their lowest price", or "what is the lowest amount they'll take." Buyers ask this for two reasons. First, they want to see if their offer will work without using counter-offers and secondly, they are trying to get best deal or not pay too much. My answer to them is always the same, assuming that the seller has not authorized me to advertise a lower price than the listing price, "sorry I can't give you that information you'll have to make an offer." Buyers do get angry when I tell them this, but they don't realize that I would be breaking the law by divulging this information. Remember all anyone really wants is a fair deal, and that applies to both the buyer and seller. So as the buyer the only way to know that you didn't pay too much is to start low and work up. I'll leave you with one last thought; I believe it was Donald Trump who said, "If you are not embarrassed by your first offer, you offered too much!"

Torres Ramey, ABR

Broker / Salesman

702-371-2785

www.torresramey.com

599 W. Mesquite Blvd.

Mesquite, NV. 89027