Today I have had an experience which is extremely frustrating. I put an offer on a property in Melbourne. The asking price of this house was $240k+. our first offer was $246k. i didn’t hear from the agent until 8pm tonight and was told the property sold for $251k and I missed out.
I didn’t get a phone call at any stage to up my offer or anything of the like. Considering this was not a set by sale date and just a private sale, I smell a rat. If the agent was acting in the interest of the vendor they would’ve called and asked if I had an increased offer. I was in fact willing to offer into 260-265k however 246k was my starting point.
Any agents or people familiar with doing this day in day out, is this normal practice to get 2 offers in a day and not go back to the underbidder for more.
they never said that offers were to be final and there would be no negotiations.
Does this sound strange to anybody else?
probably just a crap agent. It can work in your favour – the person who paid $251k wouldn’t be complaining!
http://www.megapropertygroup.comINVESTMENT SALES * RENTAL SOLUTIONS * STRATA MANAGEMENT
lazy so and so’s the agents im dealing with dont even have certificae of totles on the properties im looking at !
“It’s not how much money you make, It’s how you spend it that matters.”
Aspiring property developer
Giulio Taranto
Drop a note in the letter box of the house so the vendor knows what a sh1t job the agent has done….I had the same problem a few years back so I dobbed in the agent via a note to the vendor.
A few days later I bumped into the agent in the supermarket and she went mental at me….looks like my note worked …and I got the result I was after !!!
I think agents work for themselves. Perhaps this one too – seems that the minute he got an offer that the owner would accept he rushed it through to exchanging contracts. He gets paid and can move onto the next sale – remember a bird in the hand is worth two in the bush.
I think they work for the vendor right up until he gets the listing then he works for himself.
Nat – you have a couple of wines last night and get a bit dyslexic?
[biggrin]
Cheers,
Simon Macks
Residential and Commercial Finance Broker[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
It will be hard to prove he did not do his job properly but he sounds like a cowboy…definitely serving own interests not the vendors.
Always try to find out what’s going on by incessant phone enquiries or personal attendance to find out facts face to face and be on the spot.
At the risk of sometimes being unpopular.Jupiter Properties P/L buys brick blocks of flats/units anywhere, anytime.
ByronSam
0410473068Originally posted by NATS12:Today I have had an experience which is extremely frustrating. I put an offer on a property in Melbourne. The asking price of this house was $240k+. our first offer was $246k. i didn’t hear from the agent until 8pm tonight and was told the property sold for $251k and I missed out.
I didn’t get a phone call at any stage to up my offer or anything of the like. Considering this was not a set by sale date and just a private sale, I smell a rat. If the agent was acting in the interest of the vendor they would’ve called and asked if I had an increased offer. I was in fact willing to offer into 260-265k however 246k was my starting point.
Any agents or people familiar with doing this day in day out, is this normal practice to get 2 offers in a day and not go back to the underbidder for more.
they never said that offers were to be final and there would be no negotiations.
Does this sound strange to anybody else?
Byron Sam
Our agent sold 1 of our IP’S in 2 weeks, he had 2 buyers 1 a investor, he played one off the other, it was on at 245k, they both started at 235k, the investor stopped at 240k and the other party bought it at 241k, all this negotiating happened between 5.30pm amd 9.00pm on a Sat night, I was trying to watch the football and by 9.00pm and a few wines later i said yeah let them have it.
How would you rate this agent? His theory was you need to get a commitment while they are hot.
And of course i thought later maybe i could of got more?
RoboWell I did in fact ring the vendor to tell them if they hadn’t signed anything i would be willing to give them $10k more than the offer they’d accepted. But the vendor said the deal had already been signed. I told them that I never got a call back to negotiate and the vendor was a bit confused as to why, but at the same time I think the agent turned up at his place, put the offers in front of him and put pressure on him just to take the highest one. means the agents fee gets paid.
I will have to move on to loking for the next property now. I will never be using this particular agent to sell a house becasue i know they would put presure on me tojust accept what comes in and not work for their fees.
They only want the sale….getting another $10,00 for the vendor hardly makes any difference to the commision the earn. Sometimes its not even worth making the extra phone calls.
This is a sad state of affairs, but is the reality of the world today.
I’d be interested how you got the vendor’s number? I’m amazed at how calmly it seems the vendor is taking this. If you were prepared to pay an extra 10k, maybe the other buyer would have payed even more? He’ll never know.
Sometimes, the REA doesn’t even present the offer and makes to the vendor like there are no other offers.
I sympathise with you NATS12.
Munjy
As an agent and a buyer of real estate i can see why you have tales of woe. I sell only development sites and most of the buyers understand that there is no point in playing games. These are seaosoned professionals who do plenty of deals. Sometimes they pay above the asking price…If you were prepared to pay more why didnt you offer more in the beginning. I have done what the agent has done before however the vendor is kept fully informed that the buyers may or may not have been told that there are other offers. So long as the vendor is kept informed the decision is up to them. Learn the lesson well that if you want a property offer them your best price up front and if they want more you will walk away.
Good on you Bill – you only deal with seasoned investors who pay the asking or even more in a buyers market?
You advise someone to pay as much as they can scrape together for a property. If they don’t then they are not a serious investor? Just playing games?
You must be a great agent. Are you a serious investor too? If so then have I got a property for you. Hopefully you will see the potential and pay me well over the asking.
Simon Macks
Residential and Commercial Finance Broker[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Simon,
I totally agree with your view, 100%. NATS12 first bid was $5000 under the other guys offer. Pretty close if you ask me.
Anyone who starts high isn’t really negotiating are they?
In terms of REA, I think there are more cases of “phantom” buyers than full disclosures to the vendor. Which vendor wouldn’t want buyers to bid amongst themselves?
Munjy
Bill Johnson, unfortunately I am in the market of buying a property at a market price, not putting the highest possible offer forward first. Had the agent told me that under no circumstances would there be negotiations I probably would have put an offer in of $260k, even though my limit was 265-267k. However, the agent did not tell me this.
There are only 2 reasons I can see for this particular instance happening:
1. the agent acted in their interest and to be honest didn’t even really try to drive the price up in getting first offers
2. the agent has done a personal deal which probably means cash directly in their pocket to get a deal for a ‘regular’ client. The agent has then pressured a vendor who doesn’t really know how this all works and has got the deal through
I would love to think number 2 scenario doesn’t happen, but unfortunately it’s the only other reason I can see for this occurrence and there’s no way I can prove it anyway.
I am likely to even avoid looking at property for sale through this particular agent again.
This topic is really interesting. When we moved to Perth from NZ a few years ago we purchased our new PPOR in Perth. There was another party interested in purchasing the property we were interested in. The agent advised me both parties could table an offer and the best offer would be accepted (I was told these were the WA real estate regulations that had to be followed). The agent then came back to me and said he couldn’t tell me what the other party offered but their offer was the same as ours!!!!. I then offered $2,000.00 more that was instantly accepted as he said by regulation he was not allowed to go back to the other potential buyer. By the way if you think there was no other party……when they received the news that the property had been sold they knocked on the vendors door and offered $10,000 cash to break the deal they had signed.
The moral of the story “if you ever I sell a house in WA do it yourself!!!!!. Is this why house prices in Perth are relatively low compared to other cities in Australia!!!.ned kelly
Bill, although Simon has taken the words right out of my mouth, I just want to add that it seems very unrealistic to expect buyers and sellers not to negotiate a price.
There is always at least a 5-8% built into the asking price which can be seen as an area for negotiation, as far as I know.
NATS initially offered a good price for this property- was not low-balling!Celivia
Hi Nat,
I’m going to ruffle a few feathers here and take the opposite point of view.
A house is only worth what someone is prepared to pay for it. You were prepared to pay more but the market said it was worth less. You saved yourself some dollars for the next deal.
The problem as I see it is this. Both parties are trying to save/make as much as they can. No prob with that except that if you thought the property was worth more you should have offered more. Instead, because you wanted to save a few thousand and hope the vendor is idiot enough to let you have it you missed out. So by trying to keep a few extra $ in your pocket you lost out on what you think is a good deal.
I don’t like agents either, don’t get me wrong, but you may have had 3 or 4 other bidders higher than you. If I was an agent I would be going straight to the ones offering the serious money, not dilly dallying with low ball offers just in case they are willing to pay more.
If you had of offered what you were willing to pay and then lost the deal anyway then so be it. You could walk away knowing you would not have paid more anyway. Now you have a sour tast in your mouth because you know a deal has gone past and you didn’t even get a second chance to put in your best offer. I don’t think that is the agents fault I think it’s yours. If a vendor wanted an auction they would have paid for one. I’m not saying that you should pay what they want but make a legitamite offer based on the value you give the property.
Anyway, I would not worry too much about it. The fact that someone was willing to pay less than you means that you overvalued the property in the first place.[blush2]
The last deal I put together I started the whole low ball offer thing and realised the agent knew exactly what I was doing anyway. So after I made my initial offer which even I knew was ridiculous, I cut straight to the chase and told the agent my best offer and told them why. The only extra I added was a furfy about me having another offer in on another house and that the first to accept got my money.
A deal has to be good for both parties or someone comes out a loser. No reason both parties can’t come out happy.
The only reason I can see to make real low ball offer is if you think the vendor is motivated for some reason. Then you might get a much lower price than a place is worth.
OK everyone can shoot me down now as an agent lover…[eh]
You will always miss 100% of the shots you don’t take!
That is a very valid point of view. In fact everyone’s point of view is valid and we should always remember that – me most of all.
I think the issue is that the agent had another interested party involved and he did his vendor (who is paying him) a great disservice by not communicating that fact.
Cheers,
Simon Macks
Residential and Commercial Finance Broker[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
I must agree with Bill Johnson…
If you have finally found a house which meets all your criteria and is ideal for your specific needs (perhaps you plan to run a business from home and it is in a perfect location etc etc) then why would you not put in your best offer, knowing full well that someone else may be after the same property?
Bills words have merit, if it is ideal for your purposes don’t muck around, put in your best offer, or risk loosing out. It’s up to you.
However in other circumstances, you may just be trawling for the best bargain and it matters little if your low offer is accepted or not, just move on to the next potential bargain and make another low offer. Enjoy the game.
IMHO I don’t think you can play the game and expect to have things go your way every time.[blink] You win some, you loose some[blush2]
Regards,Sharon
At the end of the day, everyone is entitled to their own opinion, and indeed, their stance will dictate how they will negotiatiate a deal.
However, this was NOT a case of sale by tender. If it was, then everyone gets one bid, and highest wins.
It is well known that vendors do not list their bottom price. Why should buyers give their maximum price first up? If vendors asked for their lowest price, there would be no negotiating at all!
I still feel that the REA did not do the best thing by the vendor in getting the maximum price for the property. If I was a REA, I would be “dilly dallying” with every bum on the street if I thought that I could get a better price for the property- that is part of acting in an ethical and professional manner.
Munjy
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