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Real Estate: Spring Market Is Kicking Into High Gear

Also, how do you field and counter a low offer?

The spring market has definitely arrived. The snow is gone, the weather is improving and more and more sellers are preparing their homes for sale. There are 94 single-family homes available for sale (according to Garden State MLS), up from 74 active listings in January. In fact, nearly half (43 percent) of these listings came to market just this month, and over half (57 percent) are priced over a million dollars in a range of $209,000 to $9,995,000.

Throughout the month of February, there were 13 single family homes that sold ranging in price from $215,000 to $2,625,000. In addition, there are still 29 homes that are under contract.

The following is a summary of what sold this past month (February 1-28, 2011):

  • 12B Lakeside Dr. - Apartment - 1 Bed/1 Bath - $215,000
  • 670 Ridgewood Rd. - Bi-Level-4 Bed/2 Bath - $372,900
  • 26 Whittingham Terrace - Colonial - 4 Bed/3.5 Bath - $546,500
  • 95 Cypress St. - Colonial - 4 Bed/2 Bath - $565,000
  • 15 Undercliff Rd. Tudor - 4 Bed/2.5 Bath - $787,500
  • 25 Hawthorne Rd. - Tudor - 4 Bed/4.5 Bath - $1,430,000
  • 108 Slope Dr. - Expanded Ranch - 4 Bed/4.5 Bath - $1,390,000
  • 75 Farley Rd. - Colonial - 4 Bed/3 Full & 2 Half Bath - $1,430,000
  • 66 Slope Dr. - Colonial - 5 Bed/3.5 Bath - $1,525,000
  • 245 Dale Dr. - Custom - 4 Bed/5.5 Bath - $1,596,400
  • 71 Kean Rd. - Custom - 4 Bed/4.5 Bath - $1,750,000
  • 33 Birch La. - Contemporary - 4 Bed/4 Bath - $2,501,000
  • 14 Birch La. – Colonial - 6 Bed/4 Full & 2 Half Bath - $2,625,000

So what do you do if you get, what you consider to be, a lowball offer on your home? Before you ignore or outright refuse it, consider this: A counteroffer and negotiation could turn that low purchase offer into a sale.

Check Your Emotions

A purchase offer, even a very low one, means someone wants to purchase your home. Unless the offer is laughably low, it deserves a cordial response, whether that’s a counteroffer or an outright rejection. Remain calm and discuss with your real estate agent the many ways you can respond to a lowball purchase offer.

Counter the Purchase Offer

Unless you’ve received multiple purchase offers, the best response is to counter the low offer with a price and terms you’re willing to accept. Some buyers make a low offer because they think that’s customary. They’re afraid they’ll overpay or they want to test your limits. 

A counteroffer signals that you’re willing to negotiate. One strategy for your counteroffer is to lower your price but remove any concessions such as seller assistance with closing costs or features such as kitchen appliances that you’d like to take with you.

Consider the Terms

Price is paramount for most buyers and sellers, but it’s not the only deal point. A low purchase offer might make sense if the contingencies are reasonable, the closing date meets your needs and the buyer is preapproved for a mortgage. Consider what terms you might change in a counteroffer to make the deal work.

Review Your Comps

Ask your real estate agent whether any homes that are comparable to yours (known as “comps”) have been sold or put on the market since your home was listed for sale. If those new comps are at lower prices, you might have to lower your price to match them if you want to sell.

Consider the Buyer’s Comps

Buyers sometimes attach comps to a low offer to try to convince the seller to accept a lower purchase offer. Take a look at those comps. Are the homes similar to yours? If so, your asking price might be unrealistic. If not, you might want to include in your counteroffer information about those homes and your own comps that justify your asking price.

If the buyers don’t include comps to justify their low purchase offer, have your real estate agent ask the buyers’ agent for those comps.

Get the Agents Together

If the purchase offer is too low to counter, but you don’t have a better option, ask your real estate agent to call the buyer’s agent and try to narrow the price gap so that a counteroffer would make sense. Also, ask your agent whether the buyer (or buyer’s agent) has a reputation for lowball purchase offers. If that’s the case, you might feel freer to reject the offer.

Don’t Signal Desperation

Buyers are sensitive to signs that a seller may be receptive to a low purchase offer. If your home is vacant or your home’s listing describes you as a “motivated” seller, you’re signaling you’re open to a low offer. 

If you can remedy the situation, maybe by renting furniture or asking your agent not to mention in your home listing that you’re motivated, the next purchase offer you get might be more to your liking.

J S Beckerman March 07, 2011 at 02:27 PM
Above all else, listen to your instincts and stick to your financial plan and and less to the realtors' advice. A realtor only earns a commission when the house sells, so a realtor, by definition, is conflicted. Realtors hate for deals to die and usually push buyers to bid prices up and, if there is no movement, for sellers to lower prices. Finally, think twice about hiring a lawyer or home inspector recommended by your realtor .
Joanne Smythe March 11, 2011 at 03:28 AM
One wonders what purpose these articles serve? Would a real estate agent ever state the housing market is awful? These articles read like an advertisement, and should be marked as such. "Spring Market Is Kicking Into High Gear" "Winter Market Is Active Despite Snow" "Market Grew in 2010" "Market Continues To Show Signs Of Recovery" "Fall Market Remains Active" Today's buyers will offer what the house is worth today (not what it was worth in 2006). Don't like the "low" offer? Keep the house.
Ron Swanson March 11, 2011 at 02:09 PM
It's an infomercial, no question about it.
M OKeef March 11, 2011 at 02:52 PM
Infomercial agreed but I think alot of people are always curious about the real estate market. I admit I always read these columns.
J S Beckerman March 11, 2011 at 04:09 PM
Joanne is dead on. It's an self-serving advertisement poorly wrapped in a news article.
MarkDS March 11, 2011 at 04:53 PM
Hey all. No one is forcing you to click on any links. Don't like something - don't open it. It is all very simple.
J S Beckerman March 11, 2011 at 05:09 PM
Mark: You are clearly missing the point. It is an advertisement or opinion piece, so call it one or the other. The Patch should not post it without a disclaimer as it is not news.
M.Moore March 11, 2011 at 06:28 PM
At the top of the article it says Business, Opinion.
Joanne Smythe March 12, 2011 at 12:35 AM
Perhaps it should say: Real Estate, Advertising? If the objective here is for Patch to provide opinions on the real estate market, wouldn't it make more sense to feature articles from a wide variety of people, such as mortgage brokers, financial advisers, recent home sellers, recent home buyers, and others?

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