So I’ve been trying to help my dad buy a new property to live in, and he’s found this house that he really likes, the house has been for sale for 29 days, the real estate agent that he’s working with, has sent the documents to make an offer. On Zillow and realtor, the house is being sold for 769,000 but the realtors want to offer 790,000, I feel that since the house has been on sale for a while, sellers might be more willing to come to a compromise and go a bit lower than 769,000, and advice is appreciated
Hi Edwin- it's tough to give you a concrete reply without knowing more details about the property and the Seller's motivation. Typically when I'm advising my clients on submitting an offer, days on market plays a big role on where we come in on price. That being said, timing is everything in real estate, and I've come up against 2+ offers on an otherwise ignored house right at the time that my clients want to submit.
How I typically approach this is to connect with the listing agent to get as much info as possible. The mistake that too many agents make is to start and end the convo with "you got any offers?". Instead I ask about the feedback that they've been getting. What their thoughts are as to why it's still on market. What the Seller's motivation to sell is. What inspections have been done, or conditions that we need to be aware of as we structure our offer. These typically spark other peripheral inquiries that tend to help better inform how we structure the deal.
In some cases this could yield an insight into offering terms like an extended rent-back or shortened/lengthened escrows that will seal the deal for the Seller even at a lower price. Given the limited info you've shared hear, the only reason that I could see for wanting to submit an above asking price is because your suddenly competing with other buyers. Absent any additional activity I would not offer above asking and simply submit what you feel is a good fair offer and wait on a counter or acceptance.
Hope that this helps and definitely wishing you and your dad the best of luck in securing his dream home. Feel free to reach out if you have any other questions.
@Edwin Revolorio , I agree with Eduardo. Many agents these days seems to forget how a phone works, and how talkative some people can be. Now onto your question, in my experience properties sit because they are priced too high. So offering $21k more than list seems counter intuitive to me without knowing more info. Maybe the property was priced in an effort to create a bidding war that never happened, but your agent knows the sellers are actually looking to get $790.
I will note that I have offered on houses that have been listed for a long time, and magically, once I make an offer, those other buyers who felt no pressure, jump in too. There is a psychological effect to knowing someone else wants what you want, and that tends to bring out multiple offers, so maybe your realtor is trying to counteract any effect there.
@Edwin Revolorio your gut instinct is correct. I would offer under asking by a reasonable amount, but not so low you insult someone. I would never offer over asking for a property that has been on the market that long. I would also give a short time frame for responding to the offer, like less than 24 hours. That gives the realtor less time to call other prospects and alert them that the property has an offer. As @Evan Polaski mentioned, one offer seem to attract others. The agent texts everyone who looked at it in the past and says "we have an offer, but will consider yours if you still want it." It triggers "fear of loss" in a persons brain which is what causes them to write offers. Keep the time line tight and push them for an answer.
You can also ask your realtor why they would offer over asking. Maybe there is some other reason you are not aware of. It could also just be that your realtor is used to that in these markets.
I will also caution that I have made offers that my realtor thought would never get accepted, only to find them accepted quickly. It is easier to start lower in negotiation and go up. Once you start high, it is hard to go down.
GREAT advice from Joe up above ^^^^