You have spent months looking for a Windsor home and you finally found the house that you have been searching for! Now it’s time to roll up your sleeves and get ready to make your best offer. The goal: finding a price that both you and the seller are happy with. But take this into consideration: What do you do if you find out the seller is very motivated. Does this change your bid?
First of all, how do you find out if the seller is motivated. This is often good information to have if you are the buyer. If a home has been on the market for several months without much action, and word is that the seller is anxious, then chances are, they are motivated. Here is the all important question you should ask your agent before you make an offer:
1. Why is the seller selling the property?
Is the seller having financial difficulties? Maybe they want to downsize or move to a larger property. Perhaps they are carrying two mortgages. Or maybe, they are in no hurry and will stick around until they get the price they want. All of these reasons can affect your offer.
Once you have this information, or know as much is available, then you have a choice:
Offer a lowball price. Here, you can determine if the seller is motivated by their response. If they counter with another price well below their asking price, then it would appear that a seller is eager to move. If they counter with their full asking price, or refuse to counter, then you know they are not motivated at all and they may be offended by the price you offered. This is where you can determine if you want to make another offer or look elsewhere. If you want the house despite the fact that they are not coming down in price, then don’t give up and start again. Give the next offer your best offer and see if they are willing to negotiate or hopefully, accept your offer.
If you feel the home is simply not worth what the owners want, and they are not entertaining your offers, then you can walk away and come back in a month or two and see if they have lowered their price. Chances are, if a home is still on the market after 30 days, a seller will lower their price. Of course, this is a gamble as the home may sell in that time frame and the house will belong to someone else.
One thing that is helpful to know prior to making an offer is if the seller has received offers in the past but has not accepted them. You may want to offer closer to the asking price and include a few incentives, like you are willing to close escrow in 30 days or you are willing to rent back the house to them if they need to find a place to live. Sometimes, sellers need a little extra to become motivated. However, don’t make the mistake of overpaying for a home so ask your agent for neighbourhood comps.
It’s important to know, that today, we are not seeing as many motivated sellers that we have seen in the past several years. But it’s always important to get as much information as possible before you make the first offer as it could save you thousands of dollars. Carefully research why the owner is selling and ask your real estate professional for their opinions. Finding out how many days on the market or price reductions a home has taken are good indicators on how motivated a seller may be.
The best advice we can give: Offer a fair price based on the neighbourhood comps. This is important if you feel strongly about a certain property. If you love a home, it’s in the neighbourhood you desire in an excellent school district (even if you don’t have children this still should be important to you based on re-sale), close to work, shopping and entertainment, then make your first offer your very best offer unless you are convinced a seller is extremely motivated. Then work with your agent and follow their recommendation based on their experience.