strategies for making offers and negotiating?

Question

Hi BP,making offers... how do you start?do you low ball the offer in hopes to get the lowest price they will sell for?do you give an estimated offer based on what you think the property is worth?do you think negotiating way below what the property is worth as unethical? or do you think along the lines of " if they are willing to sell for that price, its on them"?what are your strategies an thoughts?thank you!

William Murrell · Answer

Don't ever be afraid to ask them to accept way less than it's worth.  If they want to sell it for that, that's their business.  People have a lot of reasons for wanting to sell a property.  Maybe they  really don't like the idea of fixing something up.  Maybe someone died or they got divorced and the physical structure of the house makes them sad and they just want to walk away.  It's up to you to find out why they want to get rid of it.  I don't feel bad about a low ball offer because I'm not their only option.  If they would like to tell me "no" or they don't like my offer then that's fine.  There are always other properties to look at and they can always list with a realtor and fix it up.

And a lot of times someone will say "this offer is way too low" and then go off and find out they can't sell as easy as they thought they could, find out it will cost too much to repair, or just get desperate and call you back to accept the original offer.  You never know.  If you're not borderline embarrassed when you offer, you're offering too much.

And from a general negotiation standpoint, never start with your max.   If you do, you have nowhere to move.  You can't come up a little bit and make the deal happen, you're just maxed out right out of the gate.  If you start lower than they want and then put some back on the table, they'll be more apt to feel like they got a win-win.