responding to a low-ball offer

I've worked with many a home seller who, when presented with an offer much lower than their asking price, react by saying, "I'm not even going to respond to that!" This response, or lack thereof, most often is a big mistake. The Buyer is obviously interested enough in your house to have made the offer in the first place. "So why the low-ball offer?" you may ask. My experience has shown me that Buyers often think that this is the way real estate deals are done, and subsequently make low ball offers because that's what they did the last time they bought a property 5, 10, or 15 years ago. Additionally, many buyers today are simply afraid to pay too much. Can you blame them?

Here are a few steps to take when responding to low ball offers:

• always counter-offer; you never know what the buyer's motivation was for making that "low-ball offer", and you'll never find out just how much they're really willing to pay unless you counter-offer their initial offer; furthermore it lets the Buyer know that you're willing to negotiate
• look at the entire offer. An offer is more then just a number, yet often Sellers focus on the number alone. What are the terms, and furthermore can Buyer and Seller agree on many or maybe all of those terms? If both sides agree on 7 different terms of the purchase, then it makes it easier for both parties to come together on the 8th term....the selling price.
• conduct an new competitive market analysis; chances are that our fast-paced market has changed your home was initially brought to market. I.E.-The Buyer's low-ball offer may not be so low after all.

In short, my experience has been that if you have sincere motivation on both sides, most disagreements between Buyer and Seller can be overcome. Yet both parties must do everything possible to take emotion out the equation. So remember Mr. Seller; the Buyer's low-ball offer isn't an insult, they're just playing ball. And you'd be wise to step back, take a breath, and play a little ball yourself...