Made an offer and seller rejected. Now what?

[Ryan Dossey]

I made an offer on a home that was in the middle of a flip where the family ran out of time/money. I made a low offer hoping that she would counter and meet me in the middle well.....

"Hi Ryan. Without using up any more of your time, I do not think that an offer of $65,000 is going to work for us at this time. I will go through my papers and double check my numbers just to be sure that your offer can or can not be worked with. Thank you for your time and best of luck to you."

Now what? I realistically have a good amount of room to increase my offer. She does sales for a living I assumed she would counter. 

[Joe Villeneuve]

If you want to make money, then you should have made your offer based on what your maximum offer was to make money.  Did you, or did you just throw a number out there that sounded like it might get you the property?

First, you need to see what your maximum offer is.

Second, if your maximum offer was what you offered, and got turned down, then wait it out....DON'T raise your offer...unless you like not making money (sometimes referred to as Losing Money).

Third, your seller's reaction wasn't a turn down.  Read between the lines.  There are more words used by her to say she is going to recheck her numbers.  That tells me a number of things are most likely happening here:

1 - She hasn't gotten any higher offers...otherwise she never would have stated she was going to "go back and review" her numbers on your offer.

2 - She is negotiating with you.  She's trying to tease you into raising your offer a little more by saying it's close.  Again, read between the lines.  If it wasn't close, she wouldn't be looking at them again.

3 - ...and this is the big one, when you put #1 and #2 above together, it tells me that your counter response should be, "sorry, but based on my numbers, my offer is as high as I can go.  If you change your mind please let me know as I'm very interested in your property.  I'm looking to make a move on my next property.  I've been looking at a number of properties and this was one of the ones that looked like it would be a good fit for me.  Unfortunately my offer is as high as I can go on it.  Too bad.  I really liked it."

4 - I bet within 7-10 days the seller comes back and asks if you're still interested.  When they do, and they will come back with a counter that raises your original offer, your response will depend on if your original offer was your maximum "analyzed" price.

A - If it wasn't, then you have some wiggle room to counter.  They may come back with an offer that works. 

B - If that was your maximum offer, whatever they come back with, you CAN'T go up past your maximum "analyzed" price.  Your reply would be that you are still interested, but not for long as you are negotiating with another deal right now that looks promising.  If that deal comes through, then you would need to pass on this one, but whichever deal you come to terms with first, you'll go with.  Again, unfortunately, the numbers won't let me raise my original offer.

5 - Patience is and always will be the REI greatest negotiating tool, right behind analysis.