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Fielding a Lowball Purchase Offer on Your Home

accepting-offer

Consider before you ignore or outright refuse a very low purchase offer for your home. A counteroffer and negotiation could turn that low purchase offer into a sale.

You just received a purchase offer from someone who wants to buy your home. You’re excited and relieved, until you realize the purchase offer is much lower than your asking price. How should you respond? Set aside your emotions, focus on the facts, and prepare a counteroffer that keeps the buyers involved in the deal.

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 thatís 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, theyíre afraid theyíll 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 youíd 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 donít 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 real estate agent whether the buyer (or buyer’s agent) has a reputation for lowball purchase offers. If thatís 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.

By: Marcie Geffner / Houselogic

Will Brexit Impact the U.S. Housing Market?

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On June 23, 2016, British voters decided that it was about time for the United Kingdom (U.K.) to break loose from the European Union (E.U.), as they voted 52 percent to 48 percent in favor of leaving the E.U.  Global financial markets reacted violently to the “Brexit” decision, with the Dow Jones, S&P, and Nasdaq indices all tumbled 3.4 percent or more on the day the voting results surfaced.

Pound to dollar exchange rate also dropped sharply after the breaking news.  In just a few hours overnight, as the “Leave” campaign gained momentum, the British pound to U.S. dollar rate hit 1.33, reaching the lowest level not seen since 1985.  For US travelers going to the U.K. for vacation, that’s good news.  The drop in the value of the currency means more bucks for your pounds when you are on vacation. But this is bad news for exports from the U.S. to the U.K., as Britons now need to pay more for the same American products, which could mean fewer goods being sold to the U.K. in the near future.

This direct effect on U.S. exports, however, appears to be rather limited, as the U.K. accounted for less than 4 percent of American exports of goods in 2015, which is equivalent to only 0.4 percent of U.S. GDP.  The direct economic impact on the U.S. economy would be miniscule, even if the U.K. economy slipped into recession.

The more significant damages, however, could be coming from indirect effects.  The panic selling in financial markets around the globe was due primarily to uncertainty about the economic conditions of the U.K., the E.U., and the U.S.  The health of the U.K. will take a hit in the upcoming quarters, as existing trade agreements with the E.U. and other countries started being questioned, while business investments to the country will be put on hold due to lack of clarity and confidence in the economic and political environment.

The housing market could benefit from the Brexit outcome though.  Treasury prices soared as investors flocked to the perceived safe haven of government bonds amid a global stock selloff after the U.K. voted in favor of leaving the E.U.  The yield on 10-year Treasury note ended down 16.4 basis points to 1.58 percent and the 30-year yield fell 13.1 basis points to 2.43 percent.  This is good news for homebuyers as mortgage rates follow the same movement of the long-term Treasury yield.  Rates were expected to remain near 4 percent for the rest of the year before the Brexit vote, but the latest development could potentially push rates further down to levels last seen in 2012.  Brexit also pretty much slammed the door shut for any Fed rate hike this year, as tight financial conditions resulting from the meltdown in equity markets could decelerate economic growth in the U.S., as well as many economies overseas.

By Oscar Wei / California Association of Realtor

Beautiful Views, Inside and Out

5 Buckboard Trail, Rolling Hills CA 90274
Asking Price: $2,725,000

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This gorgeous 6 bedroom, 3 bath home is situated on 3.7 acres in the private, gated city of Rolling Hills, CA. The 2,939 square foot split floor plan features a great room with spectacular city, mountain and canyon views. Beautiful kitchen includes premium stainless steel appliances and granite counters. Bathrooms have been recently updated. Terraced grounds include a barn and corral area and are ready for horses, orchards or even a vineyard. Convenient direct access to 60 miles of hiking and equestrian trails. Home is located in the Palos Verdes Unified School District, nationally recognized for excellence.

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This home is shown by appointment only. Please call Leslie Stetson at 310.936.1283 or Clint Patterson at 310.426.8811 to arrange a showing.

MLS# PV16126297

For more photos and information about this beautiful home for sale, visit our property site.

Avoid These 5 Common Home Seller Mistakes

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Finding a buyer for your home is just the first step on the homeselling path. Tread carefully in the weeks ahead because if you make one of these common seller mistakes, your deal may not close.

Mistake #1: Ignore Contingencies

If your contract requires you to do something before the sale, do it. If the buyers make the sale contingent on certain repairs, don’t do cheap patch-jobs and expect the buyers not to notice the fixes weren’t done properly.

Mistake #2: Don’t Bother to Fix Things That Break

The last thing any seller needs is for the buyers to notice on the pre-closing walk-through that the home isn’t in the same condition as when they made their offer. When things fall apart in a home about to be purchased, sellers must make the repairs. If the furnace fails, get a professional to fix it, and inform the buyers that the work was done. When you fail to maintain the home, the buyers may lose confidence in your integrity and the condition of the home and back out of the sale.

Mistake #3: Get Lax About Deadlines

Treat deadlines as sacrosanct. If you have three days to accept or reject the home inspection, make your decision within three days. If you’re selling, move out a few days early, so you can turn over the keys at closing.

Mistake #4: Refuse to Negotiate Any Further

Once you’ve negotiated a price, it’s natural to calculate how much you’ll walk away with from the closing table. However, problems uncovered during inspections will have to be fixed. The appraisal may come in at a price below what the buyers offered to pay. Be prepared to negotiate with the buyers over these bottom-line-influencing issues.
Related: How to Field a Lowball Purchase Offer

Mistake #5: Hide Liens from Buyers

Did you neglect to mention that Uncle Sam has placed a tax lien on your home or you owe six months of homeowners association fees? The title search is going to turn up any liens filed on your house. To sell your house, you have to pay off the lien (or get the borrower to agree to pay it off). If you can do that with the sales proceeds, great. If not, the sale isn’t going to close.

By: G. M. Filisko for Houselogic

This could be your home.

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6 Ringbit Road West, Rolling Hills, California

  • 5,664 sq. ft.
  • 6 bedrooms
  • panoramic view of the southern California sky over the Pacific Ocean
  • elegant entry way
  • much, much more….

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Learn more about this exquisite Rolling Hills home located on a cul-de-sac on Ringbit Road. Call Clint Patterson at 310.426.8811 or Leslie Stetson at 310.936.1283 for more information and a private viewing of this exquisite, spacious home sitting on roughly 3 acres of private, secluded land. And this is a gated, equestrian community.

Go to our property site for more photographs, and information about this Rolling Hills home on sale.

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