Why do realtors hate putting in lowballs for you?
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Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
6yHere is a question.....are you willing to pay someone for the time it takes them to write up the offer and put it in? Whenever someone asks me to write up a lowball that I know has no chance of going anywhere, I tell them its $500. Funny that no one takes me up on that. I guess they know its $500 essentially flushed down the toilet. They dont mind asking someone else to waste their time, but they dont want to put their own money or time up to accomplish their goal.
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- Realtor · St. Augustine, FL · Member since 2019 · 2 posts · 7 votes6y
Thats why most agents do not do well because they don't have their individual clients best interest in mind! They care more about their friends opinions than their clients needs. It takes 5 minutes to pick up the phone and give a verbal offer. If the client has proof of funds and wants to buy why not put the offer in???
- Rental Property Investor · Green Bay, WI · Member since 2014 · 36 posts · 20 votes6y
@Parker Eberhard exactly!
- Rental Property Investor · Woodstock, GA · Member since 2017 · 517 posts · 772 votes6y
Write your own P&S agreement and submit them yourself.
Most listing agents are receptive to non-agent-submitted offers if you come across as someone who knows what they're doing. Not to mention, they're fine with it because they get both sides of the commission.
I've worked with agents to submit low offers, and honestly felt bad because none get accepted and I feel I waste their time.
So, I just submit them myself.
"How do you get into the houses?"
1) If it's off-market, just ask the owner to get in
2) If it's on-market, ask the listing agent if they'll let you in...and tell them if you submit an offer and it's accepted, the agent can submit a dual-agency form and they can move it to an "OFFICIAL' realtor form...because then they know the contract isn't full of bogus.
That's my take.
- 6yJohn MorganPro MemberRental Property Investor · Grand Prairie, TX · Member since 2018 · 2k+ posts · 2k+ votes
I always use the listing agent. Look at the property with them and tell them what I’m thinking and make a verbal offer accordingly. I tell them it may be insulting, but this is all I can do and why my offer is so low. They make a phone call to the seller and if they want to play ball we go from there. There’s never a formal written offer this way. Just a phone call to the seller to discus and they usually throw out a counter offer. No harm no foul.
- Investor · Kitchener-Waterloo, Ontario · Member since 2008 · 1k+ posts · 1k+ votes6y
@Nick Zito You're making this 1000x harder than it needs to be. Just make your offer directly to the owner and mention that you will pay their agent for them, that always gets motivated sellers drooling.
- Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes6y
Go on roofstock and throw out lowballs all day long
- Real Estate Broker · Salem, OR · Member since 2014 · 15 posts · 3 votes6y
@Leah Stuever I’m a realtor, making an offer is NOT a lot of work.
- Member since 2019 · 21 posts · 12 votes6y
Hello Nick! You are right then it comes to their knowledge. Most of them are only lazy interested in commission and not low balls to not make them as much money. You should not use one to buy RE, only when selling. Being properly prepared is really your own function, educate yourself. You must be responsible for all that happens when you are leading! So do the right thing and gain knowledge only learning from actually experienced people that know what they are teaching. Learning more is always essential. The more you know, the easier and the less risky. Do not depend on others to make the right move. Good luck to you!
- Real Estate Agent · Naples, FL · Member since 2016 · 298 posts · 268 votes6y
Yes to answer your question you could but that realtors fiduciary duty lies to the seller. They also may take you less serious that someone whose been actually working with you and knows your goals. As a broker I can tell you that you always want a buyers agent representing your best interest. If your buyers agent isn't at least willing to call in a verbal then you do not have the right buyers agent.
- Rental Property Investor · New York City · Member since 2019 · 703 posts · 538 votes6y
Originally posted by @Frank Wong:
Originally posted by @Anthony Rosa:
Originally posted by @Frank Wong:
Would you work for free at your current job? Drive around town for free? Spend your weekends working for free?
Whats the point in writing a low ball offer with 0% chance of getting accepted? I get the argument from the buyer side. Well you never know unless you put the offer in. Now take it from an experience agent's perspective. You are wasting your time and mine.
I have no problem writing a low offer but you better be All Cash 7 day close non-contingent if you are not you are just talk.
To me sending 50 low ball offers and praying and hoping 1 gets accepted is not a viable strategy. Seriously all that time searching, looking, analyzing, missing out on good deals for 1? This is not how it's done.
@Frank Wong - "Would you work for free at your current job? Drive around town for free? Spend your weekends working for free?"
I truly understand what its like to work and not get paid but that happens in commission sales work. Sometimes its feast and sometimes its famine. Let me ask you this - Is it right that a buyers agent is avoiding to show a qualified buyer a house on the MLS because the commission is too low?
Hi Anthony,
Should the agent show the buyer? Yeah I think so but the agent also have specific rights on how they value their time. If their time is worth more than showing a low price home why would they do that? Reason why some agents charge full commission and why some agents are discount brokers. If your skill level and value that you bring is worth more then you have to manage your time efficiently. Only so many hours and available time to work.
Agents avoid taking buyers and listings all the time because the commission is too low. This is nothing new. If someones avg per hour is $600 why would they do something at $150. No it's not free money. It's time committed and taken away from other things that they can do.
If the buyer's agent is avoiding meaning dodging his clients and giving them the run around. No thats terrible. Just tell your clients up front I don't work in that price range let me find you an agent in my office that does.
For me, I help everyone. If you are a serious buyer regardless of price I will treat you like my #1 client.
@Frank Wong - I get it, but lets say a buyer is house shopping in the 500K-650K range and the buyers agent doesn't want to show or send the buyer anything on the MLS with a 3-4% commission. Yet, that house with the lower commission is the prefect fit for the client and the buyer wants to see it. They aren't looking out for the best interest of their client. I held a NY RE license at one point and thought there was something written in the rules that they must show their client the MLS listed house if the client is interested and can afford it.
- Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes6y
@Nick Zito 1st mistake is using a realtor, why ???? Get your deals from wholesalers or other methods. In the last 8 years with about 500 deals under my belt I have not used a realtor. Its all about your network and team
Good Luck
- Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes6y
Originally posted by @Nick Zito:
I’m not saying all, but the majority scoff at the idea of putting in a lowball for you. Does it give them a bad rap or something I’m not aware of since I’m not an agent? I agree in some markets it’s not appropriate but I’m looking at a property that’s been listed for 6 months, needs allot of TLC, it’s the owners investment property also, and vacant. Why the heck not? My math only works at 60k less than asking price but I can’t find an agent that doesn’t think I’m being “rude.” What don’t I know??
Realtors get paid when the deal closes. Low ball offers have a low probability of getting to the closing table. Would you be interested in working for free? No of course not. Same thing here.
- Rental Property Investor · South shore, MA · Member since 2017 · 1k+ posts · 1k+ votes6y
Agents have had it pretty easy in this market over the last 5 years, to be honest. Go back to 2008 and im sure 99% of the agents would have no problem putting in any offer.
How much time does it take to write up an offer? They give you the forms for free, you fill it in online, and it is sent over by a click of a button.
Dealing with agents can be tough, at least in my experience. The "lowball" offers that were actually sent in have all been accepted by the sellers.
Just contact the listing agent, and if the listing agent wants no part in it, contact the seller directly (if the offer makes sense).
- Real Estate Agent · Hermosa Beach, CA · Member since 2011 · 18 posts · 0 votes6y
@Nick Zito go straight to the listing agent. Perhaps you are in a state that can do dual agency. That way the listing agent can get both sides of the commission. More incentive for the offer to make it through.
- Member since 2019 · 9 posts · 5 votes6y
@Frank Procopio
This is exactly what I started doing, saves time and paperwork. I'm not making a lowball offer to be insulting I'm making a sound offer where my numbers will work. So many times sellers think their property is premium quality and price it so. Or they're not from the area (i.e. out of state investors) and don't really know the market. I will make that offer that makes sense for me if it gets rejected oh well there will be another one. Chances are I'll come across that same property several months later still for sale while I found something even better or try again then.
- Rental Property Investor · Rockford, IL · Member since 2014 · 4k+ posts · 2k+ votes6y
Originally posted by @Nick Zito:
I’m not saying all, but the majority scoff at the idea of putting in a lowball for you. Does it give them a bad rap or something I’m not aware of since I’m not an agent? I agree in some markets it’s not appropriate but I’m looking at a property that’s been listed for 6 months, needs allot of TLC, it’s the owners investment property also, and vacant. Why the heck not? My math only works at 60k less than asking price but I can’t find an agent that doesn’t think I’m being “rude.” What don’t I know??
You're asking, "Why won't the listing agent do my dirty work for me?"
Remember: buying a property is *NOT* about what YOU need, it's about what the seller needs. Until you understand the seller's needs, any offer you put forth will likely be rejected.
No, the listing agent won't always open up about the seller except in so far as that's to the agent's advantage. So, you must "sell it" to the agent that they can get their commission by helping you solve the seller's needs.
"The seller needs cash!" Right - the seller needs lots of slips of "paper" with pictures of deceased notables on them. What do they need cash for? What "problem" are they trying to solve?
My $0.02 ...
- Rental Property Investor · PA · Member since 2019 · 5 posts · 6 votes6y
@Dennis M. This is what I was looking for. I know this is a dumb, newbie question, but what’s the process for buying a house without an agent? Thanks in advance!
- 6yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Nick Zito:
I’m not saying all, but the majority scoff at the idea of putting in a lowball for you. Does it give them a bad rap or something I’m not aware of since I’m not an agent? I agree in some markets it’s not appropriate but I’m looking at a property that’s been listed for 6 months, needs allot of TLC, it’s the owners investment property also, and vacant. Why the heck not? My math only works at 60k less than asking price but I can’t find an agent that doesn’t think I’m being “rude.” What don’t I know??
If this is your model then get your own license.. as an owner of a few brokerages over the years. investors that can only buy one home a year or not any volume simply are not worth the time/return value for the broker..
Also pro tip:
Offer closer to ask so you get into contract then re trade on inspections.. you will have a better chance of hitting your numbers and not alienating your agents.. and putting the deals together.
- Developer · Cincinnati, OH · Member since 2018 · 1k+ posts · 3k+ votes6y
Originally posted by @Jay Hinrichs:
Originally posted by @Nick Zito:
I’m not saying all, but the majority scoff at the idea of putting in a lowball for you. Does it give them a bad rap or something I’m not aware of since I’m not an agent? I agree in some markets it’s not appropriate but I’m looking at a property that’s been listed for 6 months, needs allot of TLC, it’s the owners investment property also, and vacant. Why the heck not? My math only works at 60k less than asking price but I can’t find an agent that doesn’t think I’m being “rude.” What don’t I know??
If this is your model then get your own license.. as an owner of a few brokerages over the years. investors that can only buy one home a year or not any volume simply are not worth the time/return value for the broker..
Also pro tip:
Offer closer to ask so you get into contract then re trade on inspections.. you will have a better chance of hitting your numbers and not alienating your agents.. and putting the deals together.
I agree with Jay. I am a licensed real estate agent (in addition to being an apartment owner) and although I don't show houses and I only have my license for real estate investing purposes, I can say that having a license has helped me more than it has "hurt" me (in fact, it didn't hurt me at all).
- 6yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Michael Ealy:
Originally posted by @Jay Hinrichs:
Originally posted by @Nick Zito:
I’m not saying all, but the majority scoff at the idea of putting in a lowball for you. Does it give them a bad rap or something I’m not aware of since I’m not an agent? I agree in some markets it’s not appropriate but I’m looking at a property that’s been listed for 6 months, needs allot of TLC, it’s the owners investment property also, and vacant. Why the heck not? My math only works at 60k less than asking price but I can’t find an agent that doesn’t think I’m being “rude.” What don’t I know??
If this is your model then get your own license.. as an owner of a few brokerages over the years. investors that can only buy one home a year or not any volume simply are not worth the time/return value for the broker..
Also pro tip:
Offer closer to ask so you get into contract then re trade on inspections.. you will have a better chance of hitting your numbers and not alienating your agents.. and putting the deals together.
I agree with Jay. I am a licensed real estate agent (in addition to being an apartment owner) and although I don't show houses and I only have my license for real estate investing purposes, I can say that having a license has helped me more than it has "hurt" me (in fact, it didn't hurt me at all).
I got my license at 18 my brokers at 20 and never looked back.. it has never once caused me an issue that folks think it will ..
but I get it mom and pop I buy one house a year.. that's over kill.. unlike others here I very rarely buy from a wholesaler I have extensive broker contacts in my markets that have their networks.. same theory as wholesalers but just better mechanics for purchasing .. its very market specific though that's for sure.. I mean my wife does 10 to 15 million a year and might work with one investor or two a year that I refer who too etc.. but those shot gunning low balls we find that to be non productive on our end and at the end of the day we are all independent contractors and we get to CHOOSE who we work with.. we are not beholden to any client.. just like clients are not beholden to any agent.. Another thing that I would do if I was not licensed would be put together a decently written LOI that can be fill in the blanks and just shoot them off to the listing agents.. shows sophistication and can be done in 2 minutes.. but the reality is re trading on these beat up houses is how we get our deals. And working with the top agents in the markets who have deals as good if not better than any wholesaler I have met.
Any one flipping houses should for sure get their license.. buy and hold like a said low volume probably not worth it.. In our market were the average flip is 400 to 700k you get buy side commish and then you list yourself average deal you can save or pocket how ever you want to look at it 20 to 40k compared to the flipper that has no license and has to pay to transact do 10 of those a year and its real money.
- Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes6y
@Nick Zito how many deals have you brought to the closing table? That is one factor that agents will consider, because it says if you are credible or not. In a hot real estate market properties sell fast and usually close to asking price. If listing price is reasonable and you are 30% below, that is completely illogical. If you are doing that over and over again, it is a waste of time.
Good realtors do care about credibility. Listing agents are required to present all offers, but how they present them is totally up to the agent. If they get a low ball offer from an agent who has a bad reputation, they will let the seller know they would recommend against taking the offer. Agents with a good reputation can get their offers moved to the top of the pile.
There is two options if you are fishing for low-ball deals:
1. Make your offer directly with the listing agent. That way you are wasting different peoples time and not the same poor agent. Plus the agent gets buyer and seller commission, so may be more willing to go to bat for you.
2. Direct market to owners and try to buy without an agent. Wholesalers continuously buy properties for a fraction of their value. If you have a naive or desperate seller that is not represented by an agent, it is easier to get bad offers accepted.
- Real Estate Agent · St. Louis, MO · Member since 2019 · 68 posts · 36 votes6y
Wow!!!! There are some real haters for agents in this thread!!!
But I get it everyone wants the best deal possible for the smallest amount of money so that you, in turn, can make the most profit.
But its really not about just throwing paperwork at a property and seeing if the seller accepts. In most cases the agent has spent time researching the property history, calculating the numbers, checking back taxes and covering your *** to make sure its a good deal. To simply just throw a lowball number at a property needs to make sense, and in most cases it does. You just need to have a trust factor and a relationship with your agent to make sure you both are on the same page. I look at my relationship with my investors as a partnership and will do whatever it takes, minus a few things :), to get the deal done. If you're just picking an agent up for the first deal and haven't developed a relationship with them to where they understand your goals you will constantly get resistance. Find a realtor that is like-minded and gets the REI business and you'll have a great partner that will throw whatever offer at the seller you desire, because they are "YOUR" agent and have your "BEST" interest at heart!!!!
BTW, IMO, if you're going direct to the listing agent you are leaving a lot of money on the table and will never get the full story about the property (in most cases) unless the owner gives the agent permission.
- 6yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@Michael Ealy in my early days IE mid 80s and now with 10 years experience.. I worked as independent contractor for a mid size syndicator in the Bay Area.. they had a billion dollar portfolio between SF bay area and Sacramento.. mainly garden style apartments 20 to 60 units.. and some trophy SF peninsula properties.
However in doing their deals one of the big generators of income for their company was the commissions .. your buying even back then 1 to 5 million dollar props and the 3% fee's add up.. I got my cut when I brought in a deal.. I ran there land development efforts.. from site selection through entitlements then resale.
so like I said they got the waterfall's at exit but made their money on commish and PM and management fee;s if course,,
- Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes6y
I am always upfront in initial client consultations my strategies and that I don't do low ball offers. A large reason is reputation. Because I have a good reputation other realtors often send me deals before they even go in the MLS. Reputation is everything in this business and no one wants to waste their time with buyers who aren't serious. My strategies work well closed 10 million last year and had several clients get six figure refinance since then mainly by finding way under market rent building.
- Real Estate Broker · Hugo, MN · Member since 2016 · 688 posts · 596 votes6y
@Nick Zito @Nick Zito with under 4 units it depends on the listing agent. If I know it is a high volume listing agent I will call the agent before wasting any time. With large apartment buildings there are very few major players and putting out low ball offers will ruin your reputation as a serious broker.
Clients need to understand you are not going to be able to get free equity from a seasoned owner.
For simple sfh and such I have no problem with low ball offers, I will explain the risks to my client ahead of time.
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