When To Turn Down An Offer On Your Property
Not every buyer will be willing to offer a few hundred pounds over and above your asking price. In fact, almost NO buyer will do that in this market. But just because buyers won’t be throwing around money like they won the lottery doesn’t mean that you should settle for mediocre offers just because the house has been on the market for too long.
As much as buying and selling property should be purely based on financial logic, there is always an element of pride that comes into play. After all, this is something you have spent hours on, if not years. You have gone through all the trouble to make sure that the property is market-worthy. The very least your buyers can do is offer you a good price for it.
Know when to turn down a bad offer
Sometimes, you will get some offers that are downright insulting. As tempting as it may be, refrain from having these types of buyers arrested and charged with crimes against humanity. Instead, politely decline their offer and move on to the next one. When do you turn down offers?
When the buyer isn’t properly financed
This might sound a little bit…dare we say ‘elitist’. But in all logical sense, why would you want to sell your house to a buyer who is very likely to default on the payments? There is a good reason why buyers are advised to get their financing in order before making an offer on any house. As the seller, you need to know that the buyer will hold up their end of the deal and pay up as agreed. If their financing is a little shifty, or worse still, ‘in the works’, you are morally allowed to reject their offer until such time as they can prove to you that they have the required financing. This goes for both mortgage and cash buyers.
When they are too demanding
It is not unusual to find buyers who are willing to pay the full price but demand that you move the house to the moon first. It is a crazy world out there and people have some insane demands. What you need to understand is that buying a house is a huge investment and it is okay for every buyer to want to get the most out of it. But if they are making crazy demands such as brand new toilet, a fully stocked bar and supermodel neighbours then maybe their money isn’t worth the trouble.
They offered way below the asking price
This is, no matter how well dressed up it is, an insult. If you are asking for £120,000 and someone offers you £45,000, feel free to hang up the phone on them. This entire process takes time and you should not waste any on people who are not serious about buying a house. Genuine buyers will want to bargain the price downwards, but it is illogical to expect a 50% plus discount on anything.
Alternative to close the sale (if you badly need to sell)
Now if you need to sell quickly, but your current crop of buyers are all asking for discounts, one way to get around that is to offer flexi-terms instead. For instance, you may tell them that they can pay the deposit in instalment so that it becomes easier for them to cover the 20% down payment on the house. This will get them more favourable terms from their bank because larger down payments classifies them as less risk. Hence, this flexible deal acts like a discount in the long run.
On your end, you may not get all the money now, but at least you’ll eventually earn the price you want down the track. This type of flexible payment has been popularised by foreign investors like Rick Otton who had adapted this form of investing during his stint in the U.S.