What is your opinion?

Question

I have a client that I started working with, he is completely new to the process and I explained to him how the market currently is. He was pre-qualified (not preapproved) for $400,000 for a condo. He wants to look at $450,000 condos and negotiate down to the $400k, oh it also has to be a turnkey property. I explained to him that the market right now has no inventory, everything is lasting on average 1 week for what he wants, and everything is going over asking. I explained to him how because of the current market, it would be next to impossible to get a property under ask unless it was overpriced or if it needed a lot of work. I told him let's look at properties for 400k and under, but of course he wasn't having it. He threatened to find a new agent, and I simply told him that I am very transparent and efficient when I work, and I want to get the most for his money, but my job is to advise and actually get your properties. I do sometimes overspeak the truth which is a bad thing, but how else should have I handled this conversation. I am ok with letting him walk, cause as great as I am at negotiating, I am not going to make wine into water in this market. How would you all have handled this?

PS: he asked me why I couldn't tell him the lowest price the landlord was willing to go, and I told him how it is illegal for them to tell me. Also, we are looking for properties in Stamford, CT aka the #1 city in all of Connecticut.

PS: he asked me why I couldn't tell him the lowest price the landlord was willing to go, and I told him how it is illegal for them to tell me. Also, we are looking for properties in Stamford, CT aka the #1 city in all of Connecticut.

James Wise · Answer

You and him aren't a good fit. Move on or tell him you'll only work for him with an upfront payment for your services.

Samuel Eddinger · Answer

I think it really what you value more, your time or your money.  If you have lots of time without a lot of leads, I'd probably take it on and get him to change his tune by losing a bunch of offers without even getting a counter offer.  If you don't have as much time or value your time more, I'd just tell him that you are not the right fit as he does not value your expertise in this field.

Ultimately, the question is up to you.

Ruben Aguilera · Answer

I wouldn't say it's Illegal. I mean in the right context it could be considered simple negotiation Verbatim.

However, Realtors do have a code of ethics that they have to abide by. If violated they are subject to heavy fines. Not to mention we sign a contract to look after your best interest. If we violate that we can be sued for damages and lose our license. We put our license on the line in every transaction.

The point of his realtor is to get him as much money as possible. Telling him what the least amount he's willing to take sounds like trying to do the bare minimum. In this case you could probably get sued for violating your agreement that states that you are supposed to do what's best for them.

They also can't tell you what the highest offer is or what the lowest offer is or any details.

Bruce Lynn · Answer

Who's the better salesman?  Him or you?   You have to tone up, bulk up, workout your skills.   Right now he is hustling you.  You have to be better at sales than he is.

Ruben Aguilera · Answer

I personally would simply put offers on his behalf even though I know they are not going to materialize. After each one I would call the agent and ask them "if you were to rank our offer, what place did we come in? how close was it to first place or last place?" After three or four offers with feedback I would tell him we you want to "use our time more productively." Explain to him if he doesn't want to pay full price he has a couple of options. He could "drive until you qualify" which means looking in an area that's farther away to find what he needs. We could re-adjust the budget, or we could wait until the rates drop.

If you want to avoid trips all together and not waste your time schedule your showings one or two days after the homes come out - then ask the listing agent if they have an offer above asking or around asking price before heading there. Then you can call him and tell him "hey, I just want to let you know that I called the listing agent earlier and it seems they have an offer above asking. Did you still want to see the property? I just didn't want to make you drive down here unless you really loved the property and you were willing to submit a strong offer. What do you think?"

Then let him talk. He will ask you questions in order to push his point and you could say something like "Well, if they have offers above asking I don't see how they would take our offer if we come way below. Would you? What would you like to do?"

Always give them options and make them feel like if they are in the driver seat. Don't let him drive you crazy though, just be strategic about it.

Those are my two cents, I hope that helps!

Dave E. · Answer

@Simeon Rivas sometimes clients just aren’t a good fit. The next time he “threatens” to find another agent I would just politely tell him that you think that is a good idea. Your time is important also!

Scott Watson · Answer

Hello, I'm curious as to why it would be illegal to let him know the lowest price the landlord (owner/seller?) would go?

I could see if you are representing both but it doesn't say that in the post so wondering if there is something else?

I would think that picking something up in honest conversation or negotiations would be awesome!

Bruce Lynn · Answer

Sometimes they have to loose 2-3-10 before they understand.

Maybe you can do some things to sweeten the offer.  Can he give 60 free leaseback to the seller?

Can he pay all closing costs, even that of the seller?

Is he putting great money down like 50% so there might not be an appraisal?

Anything he can give the seller to help the deal, frequent flyer miles, timeshare stays, vacation home stays, professional services like free tax returns, sport tickets, etc.

Have you shown him sample CMAs to show where the market is.  People say they want 10% off or have some number someone told them to use as a starting point.  Then you show them the maximum discount was 2% over the last year and they may get the point.   Show them the numbers where everyone bid 2-3-4% over.  If it gets recorded show them the financing amount.

Sometimes I ask them if they just want to be a bidder, or if they're looking to actually move in, because at this number you're a bidder not a winner.  Some markets and could very well be yours...the asking price is a starting price to work up, not a price to negotiate down from.  You may have to explain that.   Ask them how they would feel if someone else gets to move into their dreamhome?    That sometimes gets the squirrels moving in their head.

Good luck....

Hamp Lee III · Answer

I’ve experienced some of the same with clients no matter how much you try to educate on the specific market.

Not all sales are good ones and you must know when and where to draw the line. You don’t want to waste your time with someone who puts you through so much and is willing to threaten to leave you so quickly.

Great clients will come along and your current one may not be it…and it’s okay. Learn from your experience and move on. Sometimes that’s the best for both parties.

I wish you all the best.

Chris Merchant · Answer

Have you ever seen the show on HGTV love it or list it?  How the agent shows the people a property with EVERYTHING they want to show them that the amount they are looking to spend will not get them the home they want.  It opens the clients eyes that they need to either increase their budget OR start making concessions on their demands.  I understand you as an agent time is money and running this guy around looking at homes you know he can't afford is not efficient use of your time but he needs to understand that in CT right now properties are going to bidding wars.

I know a LL in Norwich CT that just had 3 tenants get into a bidding war over an apartment he had for rent.

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