I had a buyer in Covington call me last week about a great home I have listed... beautiful home, like-new condition, move-in ready, great location, wonderful school district, fantastic value. He had looked at the home before and loved it, but he was calling to see if the price had been reduced yet or if it had gone into foreclosure. "It's still too high for this market. I think I'll wait until things bottom out so I can get a real steal," he said.
I tried to impress upon him what a great value it was for his family, how it was on the market due to a corporate transfer, would not go into foreclosure, and that it might not be there when he perceived the market had bottomed out... if, indeed he could read the market that well at all. But all to no avail!
Following is piece written by Janet Guilbault, a mortgage adviser in Walnut Creek, CA. It is so insightful that I felt compelled to reprint it here for the beneift of buyers, sellers and Realtors in our market. As Janet points out, getting the BEST HOUSE in YOUR LOCATION OF CHOICE at a hugely deflated price should make anyone happy. What else is there?
What is the biggest misconception in the mind of the guy about to make an offer on a house?
- This seller must be absolutely desperate to sell this house.
- I will ignore the asking price, because all houses are priced with plenty of negotiating room.
- Sellers expect low ball offers in this market.
- Any seller would be lucky to have me buy their house.
- It can't be a good buy unless I am able to steal the house.
- If this offer doesn't go through, I'll just keep on low balling until I get another house.
- I am a brilliant negotiator.
- If the seller won't take this offer, I will walk away for a few weeks and let them stew until they do.
- No one else would want this house, anyway.
- No one pays full price in this market unless they are stupid.
The sorry state of our economy and the desperation of the retail world have combined to brainwash our clients about buying real estate. Somewhere along the way, "stealing the house" and "winning the negotiations" became more important than landing the best house in the best location at a price you can afford.
Extreme bargain hunting has become a national addiction, and it is spilling over into the real estate industry.
When EVERYTHING we buy from automobiles to clothes is marked down 50% or more, has a coupon attached for a further discount, and comes along with freebies on the side, is it any wonder buyers of real estate have developed an attitude of EXTREME superiority, believing sellers are mere beggars?
Can you see how they have been conditioned to believe that as a buyer, they can call all the shots, no matter how ridiculous?
Many think those beggar sellers must be thinking this:. "Please, buy my house. I am desperate, you know, and expecting your ridiculous offer".
And you know what they say, beggars can't be choosers. And so the stuggle to convince buyers that a house, ANY house, is priced "right" continues.
Here's a news flash: beggars may not be able to be choosers, but losers can sure be snoozers.
Buyers should ask themselves this: Am I willing to risk losing the house I love because I am addicted to scoring an extreme bargain?
Isn't getting the BEST HOUSE in your LOCATION OF CHOICE at a hugely deflated price enough of a high?
Or has extreme bargain shopping become like a drug addiction? You will sacrifice your long term well-being and logical thinking for that 10 minute high of feeling ever so smart because you "stole" the house?
Before you smile just thinking about how to make the seller squirm, remember this:
There is just that one piece of real estate in the whole world. That is what makes a house different from buying a car or a sweater.
Remember these things too: You cannot return it. You can sell it, but the cost of doing so will probably be far more than any savings from your extreme bargain.
Then get your priorities straight. It is about getting the house. Not getting the extreme bargain you can brag about at your next party. That feeling of superiority will last what? For a few days?
Getting the right house can give you a lifetime of pleasure and satisfaction. Even if you pay full price, you will look back and be amazed at the EXTREME BARGAIN these economic times served you up on a silver platter.
Want to know another secret? Sellers are not nearly as desperate as you think.
Written by Janet Guilbault, Mortgage Lending Expert Based Out of the San Francisco Bay Area
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Your comments and questions are always welcome
Great post Bill! Wish I had the nerve to send it to a couple of my current buyers!!!