How to lowball a home seller

Make your case with hard facts

When putting together an aggressive offer for a client, Boyd doesn't just hand the seller a purchase agreement with the price the buyer is willing to pay -- he creates a cover letter explaining exactly where that number came from.

In addition to citing comparable sales in making the offer, the potential buyer should also consider including details on the amount of inventory in the immediate surrounding area, he said.

"If we just looked at the relative values of the houses that sold, we would end up paying too much for that house because we know that the values are going to fall," he said.

Buyers may even personally write a letter to the sellers to make their point, as they did when the market was hot and they aimed to stand out from the crowd, Gaylord said. That way, they can detail what they like about the house but express their fear of continued dropping values.

That's still not to say the seller will respond positively.

Prepare for rejection or negotiation

Ultimately, a real-estate agent working on behalf of a buyer needs to honor and facilitate the offer that the buyer wishes to make -- even if it seems too low.

Gaylord offers a word of warning to buyers making very low offers, pointing out that the seller might refuse to negotiate. On a "superaggressive offer," Boyd might tell a client "there's a one-in-five chance there will be a positive response."

Prepare for rejection or negotiation

Ultimately, a real-estate agent working on behalf of a buyer needs to honor and facilitate the offer that the buyer wishes to make -- even if it seems too low.

Gaylord offers a word of warning to buyers making very low offers, pointing out that the seller might refuse to negotiate. On a "superaggressive offer," Boyd might tell a client "there's a one-in-five chance there will be a positive response."

Still, a seller could potentially counteroffer, especially if there hasn't been many other bids. Danielle Kennedy, a real-estate sales coach and author based in Pacific Palisades, Calif., advises sellers not to think of a low offer as an insult but as "a sign of interest."

"And it begins the dialogue regarding the purchase of your house," she said in an e-mail interview. "They should make every effort to be grateful that an offer has come in."

Also, not all hope is lost even if a seller doesn't bite immediately.

Sometimes after time elapses, the seller comes around and decides to negotiate, Boyd said. Or new information -- such as the sale of a comparable home at a lower price -- can nudge a seller to give an aggressive offer a second look and open the negotiation process.

This article was reported and written by Amy Hoak for MarketWatch.

Updated Feb. 17, 2009

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