Act like you hate it!

The title is one of my favorite quotes from King of the Hill. Hank (the dad) grudgingly decides to buy a new truck. Upon test driving the truck, both he and Bobby (his boy) love the truck! As they are headed in to start negotiating, Hank tells Bobby those immortal words "act like you hate it".

Why should we hate something we are bidding on? Isn't the fact that we place an offer a good indication that there is some interest in the item?? From teaching my college course on negotiation to my more practical experience with clients, I have found people tend to go about negotiating the wrong way.

There is a tendency among folks to "start low". By doing this, there is a hope that the sell would give more ground (or even better accept the low ball offer). In the real world this almost never happens.

In my experience low ball offers cause the seller to be LESS willing to negotiate. Such offers tend to make sellers defensive as opposed to cooperative. Consider the following example with two different approaches.

123 Main street is listed for 150,000 dollars. This three bedroom home has been on the market one month and is in good condition. Homes in the area typically take 3-5 months to sell.

In the first scenario, the buyer client offers 125,000 for the home. This is FAR less than fair market value. The seller counters at 148,000. Really wanting the home (and running out of time) the buyers counter at 147,000 which is accepted.

In the second example the buyer client offers 145,000. Not wanting to chance loosing such a good offer, the seller do not counter, but accept the offer.

The low-ball loses! I have seen this play out several times just this year! In the next post I will cover how to make a strong offer. Again call 318-613-1994 for all your Cenla real estate needs. Happy house hunting!!