Attention investors Don't be this guy.

Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes

Just got off the phone with another Realtor who showed one of my homes. Her clients gave me an offer that was 25% of the list price.

Please folks Don't be that guy. Show some respect for others & their time. This poor lady had to waste an afternoon driving this schmuck around.

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J ScottPro Member

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Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes

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Verbally counter back at $1000 higher than his offer. Let him get all excited and have his agent write up a formal counter at the new price. Then tell him you changed your mind, but you'll do it for $3000 more than that. Let him have his agent write up a new counter. Then tell him you changed your mind again. See how many offers you can get him to write before he gets pissed and walks away...

My record is 3...

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Sharad M.Pro Member
Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
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Originally posted by @Account Closed:

Originally posted by @William Johnson:

I think a lot of people on this thread must not remember what it was like to be starting off as an investor. At the same time I appreciate the fact that most seasoned investors and agents have that same attitude because it discourages and filters out the vast majority of investors starting out and reduces the competition I have to face for deals so...Thank You very much!!
I think a lot of people on this thread failed to comprehend the original post. @James Wise was not complaining that the investor submitted a lowball offer. He was annoyed that the investor used an agent to do it, and totally wasted HER time.
David, why are you assuming that the investor wasted the agent's time? We don't know if it was the agent who suggested a low starting price? We don't know if the investor made 10 other offers with the agent and a lot of them got accepted and the investor and agent figured to make a low ball offer to see if they get any positive response?
I have worked with my agent for about 3 years now and have done over 100 deals together and if I ask him to make a low ball offer, I am not wasting his time, because we have had some crazy offers accepted.
You will never know if the seller will take a low offer unless you ask for it.
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
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Originally posted by @Sharad M.:

Originally posted by @Account Closed:
Originally posted by @William Johnson:
I think a lot of people on this thread must not remember what it was like to be starting off as an investor. At the same time I appreciate the fact that most seasoned investors and agents have that same attitude because it discourages and filters out the vast majority of investors starting out and reduces the competition I have to face for deals so...Thank You very much!!
I think a lot of people on this thread failed to comprehend the original post. @James Wise was not complaining that the investor submitted a lowball offer. He was annoyed that the investor used an agent to do it, and totally wasted HER time.
David, why are you assuming that the investor wasted the agent's time? We don't know if it was the agent who suggested a low starting price? We don't know if the investor made 10 other offers with the agent and a lot of them got accepted and the investor and agent figured to make a low ball offer to see if they get any positive response?
I have worked with my agent for about 3 years now and have done over 100 deals together and if I ask him to make a low ball offer, I am not wasting his time, because we have had some crazy offers accepted.
You will never know if the seller will take a low offer unless you ask for it.
I didn't make any assumptions about anyone. What I did was make an observation that a lot of people in this thread have a reading comprehension problem. Perhaps it is based on an eagerness to argue or debate a topic. Not sure, but it has been confirmed that I read the original post correctly.
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
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@Sharad M.
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Sharad M.Pro Member
Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
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@Account Closed
How did you get to this?
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
11y
Originally posted by @Sharad M.:
@Account Closed
How did you get to this?
I got it from the original post in the thread, that was started by @James Wise
So it wasn't my assumption that her time was wasted. Also, James has reiterated that he wasn't annoyed by the low ball offer, yet this thread has taken a path that suggests otherwise.
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
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@Sharad M.
For some reason when I click reply, the @mention isn't working for who I am quoting.
In any case, here is the quote from the original post:
"Please folks Don't be that guy. Show some respect for others & their time. This poor lady had to waste an afternoon driving this schmuck around."
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James Wise
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Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
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@Sharad M. @Account Closed
Yes it seems that the thread has vered off the path a bit.
Sharad, David is correct.
I think the "investor" that made an offer on one of my homes is a total bum.
I DO NOT think he is a bum for sending me a ridiculous offer that is 1/4 of my asking price.
I DO think he is a total bum for calling agents and wasting their day with his ridiculous & unrealistic goal of purchasing a home for 25 cents on the dollar.
The home is priced as it should be. I have received 2 offers that were triple this offer in question
My post it not to discourage those from trying to score a deal but to discourage those who go about it the wrong way. Those who have no respect for others & their time.
"Investors" who go around thinking that all agents are there solely for the purpose of serving them.
I believe that if you want to write up 100 offers in the hopes of landing 1 you should be doing it yourself or hiring an assistant to do it.
Personally I think there are better uses of ones time but if that is how one wants to operate I say have at it & good luck...But calling on unsuspecting agents & taking them away from a productive use of their time shows a lack of social respect.
"Investors" like this remind me of people who don't tip their waitresses or tenants that think that just because they want a certain property they will automatically get it.
"Screening process? What do you mean? I want it, give it to me now"
Paul, Bank or owner doesn't matter. Again I was speaking to his relationship with his own agent.
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Matt R.
Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
11y
I guess a lot of this depends on your market. I rountinely see crazy low ball offers and sold prices in some markets. I am pretty sure the Cleveland area is one. Either way no one should waste realtors time. You got to figure anything under 100k in some areas is a liabilty and some owners want out at any price.
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Sharad M.Pro Member
Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
11y
Originally posted by @James Wise:

@Sharad M. @Account Closed
Yes it seems that the thread has vered off the path a bit.
Sharad, David is correct.
I think the "investor" that made an offer on one of my homes is a total bum.
I DO NOT think he is a bum for sending me a ridiculous offer that is 1/4 of my asking price.
I DO think he is a total bum for calling agents and wasting their day with his ridiculous & unrealistic goal of purchasing a home for 25 cents on the dollar.
The home is priced as it should be. I have received 2 offers that were triple this offer in question
My post it not to discourage those from trying to score a deal but to discourage those who go about it the wrong way. Those who have no respect for others & their time.
"Investors" who go around thinking that all agents are there solely for the purpose of serving them.
I believe that if you want to write up 100 offers in the hopes of landing 1 you should be doing it yourself or hiring an assistant to do it.
Personally I think there are better uses of ones time but if that is how one wants to operate I say have at it & good luck...But calling on unsuspecting agents & taking them away from a productive use of their time shows a lack of social respect.
"Investors" like this remind me of people who don't tip their waitresses or tenants that think that just because they want a certain property they will automatically get it.
"Screening process? What do you mean? I want it, give it to me now"
Paul, Bank or owner doesn't matter. Again I was speaking to his relationship with his own agent.
James,
Do you know this investor personally? How do you know that he isn't getting similar deals accepted? Do you know his track record?
What if the agent is writing 500 offers per month for this investor and getting 5-6 accepted and making about $10,000/month doing this. I doubt the agent would mind.
May be the agent doesn't feel like she is being taken advantage or she is wasting her time.
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Paul S.
Investor · Valparaiso, FL · Member since 2014 · 374 posts · 76 votes
11y
I have made a few offers in the past (nothing like 1/4 of asking price) and my realtor was always happy to send them in. My realtor told me we can offer whatever we wanted to but I think he knew I was not going to try and pull something like "that guy" did. I think as long as you are serious about your offers and put some thought into them then there should be not shame in making whatever kind of offer you want.
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Greg H.Pro Member
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Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes
11y
As investors, we love to make low offers to purchase properties and get the best deal possible !
When we become sellers, we hate offers from investors that want to get the best deal possible!
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Stephen S.
Wholesaler · Holiday, FL · Member since 2013 · 571 posts · 221 votes
11y
How about if you don't be This Guy?

I just looked at a 2/2/0 house. It was 'remodeled' maybe 15 years ago into an open balcony master BR up with an open metal center-spine staircase. One other small BR down built in half the space where the small garage was originally. Gas forced air heat but there is a leaking oil tank in a shed on the side of the house. Some very nice materials were used but some stupid practices as well. A bath was added so there are two baths but both are now showers. One of the baths is literally wide open to the kitchen. And on and on - there is zero back yard - built to the property line. 4 foot side yards and a smallish front yard taken up by neglected water features and long un-tended trees and bushes and so forth.

The cellar has a 4" PVC drain running across it at waist height - at the bottom of the stairs. The exterior is / was T-111 siding that is partly rotted and completely covered over with dense ivy. Much of the roof is as well. The house has apparently been empty for some time. $6000. annual taxes.

There really are no accurate local comps as the house is so 'unique'. But a normal 2/2/1 on the same street, all squared away and in move in immediately condition would be about $110K This one has no back yard, no tubs, and no privacy-from-kids spaces.

It's listed for $99K and has been on the market for 700+ days. At 100% it might sell for $80K. I assessed all of what is needed and offered $30K. The listing agent was not only appalled but refused to even submit the offer until I reminded about the legal obligation. Later I thought more about it and then re-offered $21K.

The listing price doesn't mean a thing to me. I am only concerned with what the house is worth.

stephen
------------

Originally posted by @James Wise:

Just got off the phone with another Realtor who showed one of my homes. Her clients gave me an offer that was 25% of the list price.
Please folks Don't be that guy. Show some respect for others & their time. This poor lady had to waste an afternoon driving this schmuck around.
2 Reply
William Donaldson
Clemson, SC · Member since 2012 · 82 posts · 19 votes
11y
I don't believe James intended for the thread to become a repository for all of the hypothetical scenarios (as well as actual experiences) that warrant an offer that is ~25% of list price.
Obviously there are properties where a "low-ball" offer is warranted. Obviously there are realtors willing to submit lowball offers for investors who actually close a decent amount of deals and therefore make the realtor money. Obviously there is nothing inherently wrong with a lowball offer.
Correct me if I'm wrong, but the thread was intended to serve as a warning to new investors who think it is okay to use the time and services of a realtor to submit lowball offers WITHOUT informing the realtor of their intentions. Many realtors would decline to show properties to a new investor who only intends to lowball. And for the devil's advocates: obviously it would be okay for the new investor to submit a lowball offer through the realtor if the investor had the intent and means to be a legitimate buyer (i.e. not throw out lowball offers to see what sticks) and the property warranted a lowball offer.
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James Wise
OP
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
11y
Originally posted by @Sharad M.:

Originally posted by @James Wise:
@Sharad M. @Account Closed
Yes it seems that the thread has vered off the path a bit.
Sharad, David is correct.
I think the "investor" that made an offer on one of my homes is a total bum.
I DO NOT think he is a bum for sending me a ridiculous offer that is 1/4 of my asking price.
I DO think he is a total bum for calling agents and wasting their day with his ridiculous & unrealistic goal of purchasing a home for 25 cents on the dollar.
The home is priced as it should be. I have received 2 offers that were triple this offer in question
My post it not to discourage those from trying to score a deal but to discourage those who go about it the wrong way. Those who have no respect for others & their time.
"Investors" who go around thinking that all agents are there solely for the purpose of serving them.
I believe that if you want to write up 100 offers in the hopes of landing 1 you should be doing it yourself or hiring an assistant to do it.
Personally I think there are better uses of ones time but if that is how one wants to operate I say have at it & good luck...But calling on unsuspecting agents & taking them away from a productive use of their time shows a lack of social respect.
"Investors" like this remind me of people who don't tip their waitresses or tenants that think that just because they want a certain property they will automatically get it.
"Screening process? What do you mean? I want it, give it to me now"
Paul, Bank or owner doesn't matter. Again I was speaking to his relationship with his own agent.
James,
Do you know this investor personally? How do you know that he isn't getting similar deals accepted? Do you know his track record?
What if the agent is writing 500 offers per month for this investor and getting 5-6 accepted and making about $10,000/month doing this. I doubt the agent would mind.
May be the agent doesn't feel like she is being taken advantage or she is wasting her time.
that's about 1 close per 100 written offers. 100 houses toured.

In this asset class the commission would be closer too $5k a month.

That's nuts.
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James Wise
OP
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
11y
Originally posted by @William Donaldson:

I don't believe James intended for the thread to become a repository for all of the hypothetical scenarios (as well as actual experiences) that warrant an offer that is ~25% of list price.
Obviously there are properties where a "low-ball" offer is warranted. Obviously there are realtors willing to submit lowball offers for investors who actually close a decent amount of deals and therefore make the realtor money. Obviously there is nothing inherently wrong with a lowball offer.
Correct me if I'm wrong, but the thread was intended to serve as a warning to new investors who think it is okay to use the time and services of a realtor to submit lowball offers WITHOUT informing the realtor of their intentions. Many realtors would decline to show properties to a new investor who only intends to lowball. And for the devil's advocates: obviously it would be okay for the new investor to submit a lowball offer through the realtor if the investor had the intent and means to be a legitimate buyer (i.e. not throw out lowball offers to see what sticks) and the property warranted a lowball offer.
Exactly!
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
11y
@James Wise
My old partner in my timber was just this kind of buyer and seller when he was buying it was hey that's not worth that but when we then own the asset and sell it all of a sudden its priceless.. and timber is another art form in of itself.. big money in the right timber stands dwarfs anything we talk about in SFR's there is a reason they call the Barrons Timber Barrons..
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Christopher Winkler
Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes
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Great thread, when we are selling we want the most we can get and when we are buying we want it for as low as possible. This is when the REAL selling starts, and its called NEGOTIATION!
James, did you even bother to counter slightly lower than your original price?
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James Wise
OP
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
11y
Originally posted by @Christopher Winkler:

Great thread, when we are selling we want the most we can get and when we are buying we want it for as low as possible. This is when the REAL selling starts, and its called NEGOTIATION!
James, did you even bother to counter slightly lower than your original price?
I did not.
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Christopher Winkler
Specialist · Dallas, TX · Member since 2014 · 900 posts · 392 votes
11y
Originally posted by @James Wise:

James, did you even bother to counter slightly lower than your original price?
I did not.
The Russians start their negotiations a couple hundred below their original price and inch down, ever so slowly. A low ball offer brings out desperate sellers and occasionally it works, and you can get a smoking deal. It's always a good idea to try it; what do you have to lose?
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J ScottPro Member
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Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
11y
Originally posted by @Christopher Winkler:
James, did you even bother to counter slightly lower than your original price?
General rule of thumb I've always used in negotiations -- when you counter an offer, you are giving credibility to the offer. In other words, when you counter, you are essentially saying to the offeror, "I take your offer seriously and choose to engage in negotiations in hopes of coming to an agreement."
But, when I don't take an offer seriously, I don't want to send this message. I'd rather send the message, "Your offer doesn't constitute something I take seriously. I don't believe we have any possibility of reaching common ground and I choose not to engage."
I do that by ignoring the offer (or telling the offeror that I'm choosing not to counter). In some cases, I'll counter at full-price, but I don't believe it conveys the message that I'm trying to send nearly as well.
There are mathematical reasons not to counter a little bit below full price as well (at least for Americans)...but that's a separate discussion...
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Pat Martin
Knoxville, TN · Member since 2014 · 116 posts · 57 votes
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It not the client/investors job to decide whether or not they think the realtor is wasting their time. The realtor can make that decision for themselves. Most realtors don't have anything better to do and are willing to work with anyone. That's their own prerogative.
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Jesse B.
Real Estate Investor · Cheyenne, WY · Member since 2014 · 71 posts · 37 votes
11y
I think the key point from @James Wise is that this house is fairly priced. I would expect most investors would have an idea of what market value should be. How many of you would need to have a realtor drive you around so you could make an offer at 25% of list? In my market I would make a standing offer of everything on the mls right now at 25% of list, sight unseen. Granted maybe Cleveland is different...but who wants to be the guy wasting a realtors time listing 80% above market?
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
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Originally posted by @Pat Martin:

It not the client/investors job to decide whether or not they think the realtor is wasting their time. The realtor can make that decision for themselves. Most realtors don't have anything better to do and are willing to work with anyone. That's their own prerogative.
This is the second idiotic post you have made in this thread. You planning to go for the hat trick?
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
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@Pat Martin
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Account Closed
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
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Rereading the point put forward in the original post:
"Please folks Don't be that guy. Show some respect for others & their time. This poor lady had to waste an afternoon driving this schmuck around.",
I now see why this thread took a different turn. Calling a female agent acting under supposed free will a "poor lady", and an investor making offers that the OP finds a waste of time a "schmuck". Assumptions and name calling don't give us much to work with. But the topic of lowball offers? There's some juicy stuff.
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