Let's all agree that our home is our castle, and that we have put years of loving care into every update, and painstakingly maintained it for years and that if a buyer can't see that, well, they can just move on!
This may sound over-the-top, but if it does, you're probably not trying to sell your home right now. If you are, the emotions feel familiar. And an emotional response is something you need to avoid. TRY not to be insulted if someone sends you a low offer. That's the way it goes in buyer's markets (or almost any market, for that matter.) The buyer may really, really want your property, but can't stand the thought of leaving any money on the table with an initially high offer. It's really not personal, although it sure feels that way.
The point is to stay calm, and counter-offer (that ridiculous offer!)the best you can. Don't try to read the mind of the buyers, or guess their intentions - this can drive you crazy, by the way. See what happens after you counter back. You might be pleasantly surprised. Either way, especially if you have no other offers, you need to work any offer you get to the end.
Look at the Terms
When considering a counter-offer, terms are just as much in play as price. What are your goals? When do you need to move? Will the buyer give you time to get out after closing? Is the buyer offering cash, or getting 100% financing which may mean appraisal problems in the end? Are they asking for anything else, like closing costs?
When you send your counter-offer, remember to thank the buyer for their offer, and let them know you have carefully considered it, and look forward to hearing their response. I've found through the years that most RESIDENTIAL buyers don't appreciate hard-nosed, abrasive responses, and will tend to hang in there with those that respond professionally, not emotionally.
If you Just Can't Make it Work
Look at the entire process you just went through, and consider where you are in the marketplace. What did I learn through all this? What adjustments do I need to make in order to sell to the next buyer? What could I have done differently? These are tough, look-in-the-mirror and take a deep breath questions, but understanding the truth of your situation and getting sold is the goal!
I've talked at length about the relationship between pricing and the number of first showings you get - first showings are necessary to sell your property and first showings are a function of price. There is also an important function to be aware of concerning second showings. Second showings are a function of your house in a price range versus the competition. If you are getting your 12-15 first showings in a month, you should be seeing 2-4 second showings, and getting 1-2 offers. If you aren't getting second showings, you need to know why not. This is where feedback after a showing is crucial.
You want your agent to get feedback after every showing, as soon as possible after the showing. After all, there's only one piece of good news - they are writing you an offer. Everything else is bad news, and you should want to know every bit of it. What specifically turned off this buyer that they aren't coming back for a second showing, or won't be writing an offer? Is there something that can be addressed (read here - 20 year old builder grade blue carpet!), or fixed? My experienced investors want to know every negative remark, and are constantly tweaking their properties for sale.
If there is something turning buyers off that can't be easily changed, like an undesirable floor plan, well, ultimately, there is a solution...
There are several great articles on the web concerning home pricing. The one I read this morning from Zillow has a lot of solid thoughts on the subject.
One thing that isn't talked about enough is showings. Experienced agents know that showings are the real indicator of whether your market price is fair value. Buyers will pounce on homes that are priced right. Bottom line, in every market, whether a $50K home or a million, a home that is priced right for it's market will generally see 12 - 15 showings in a month. There is truly a magic pricing point where buyers will find you. OBTW, looking for unique buyers for your unique property is pretty much over for now.
Sellers ask all the time: "Why don't buyers just send me a lower offer if they think I'm priced too high?" It's an understandable question. The answer is, they haven't found you, yet. Agents set up searches for themselves and for their buyers. If a buyer tells their agent: "Look up to $700,000," and you are priced at $700,001, you are essentially invisible. In practice, many agents search over their buyer's upper limit, but it's not necessarily a common practice. Take this a step further and ask any active home buyer you know, "What price range are you looking in?", and it will generally be a round number, like $750K or $700K, rounded by $25,000 increments.
You need showings in order to sell. Are you invisible?
I got an email notice that Kerri had posted her listing on her Facebook account: Kerri's Listing. I think you would be shocked at how many homes (that are readily viewable to all via MLS, yet still available) are sold by agents that went the extra mile and got out the message in unconventional places and and the result was some agent or buyer thinking, "We should take a look at that one." Kerri took the time to promote her client's home in ways that many do not. I bet she sells it...soon.
Too many choices in the housing market makes deciding to purchase even tougher for buyers today. For instance, there are the obvious questions, "Is the market at at the bottom?" "Will the economy get worse?" These are questions on everyone's mind these days. As to the market bottom question, however, I'll only say that the only way you can determine when the market has hit bottom is only after it's already on the way back up.
These questions are not the decision making problems I'm talking about, however. What I'm talking about is the fact that with increased inventories in practically every market category, it becomes increasingly difficult for many buyers to make a choice that leads to ultimate personal satisfaction! Too many choices leads to paralysis. The fear of making a bad choice forces us to make no decision at all, or at the very least delay, delay, delay the decision making as pointed out by Seth Godin in his recent blog post.
What's really going on here in my opinion, is what Barry Schwartz writes about in his book "The Paradox of Choice". Too many choices can actually have the effect of diminishing our ultimate satisfaction! We become too worried about making a bad decision. This may seem false on the surface, but think about it. Why do we channel surf so much when we watch TV? We're afraid of what we're missing on another channel! When we only had three channels, we knew what we wanted to watch and a remote control was far less necessary, right? (For those of you born after the advent of cable TV, you have to trust us older folks.)
So, what's the solution? I'll paraphrase Barry Schwartz, "The secret to happiness is low expectations! In this world where perfection is the expectation, it is increasingly difficult to have experiences that are a 'pleasant surprise'." Or, more to Seth's point, make a solid decision, and move on with your life! It's far healthier in my opinion to make an informed decision and accept the results. This isn't about diminishing the information process and accepting shortcuts, rather, it's about making good decisions, and stop trying to make perfect ones. It's a relief, isn't it? The pursuit of perfection is exhausting! These are the best of times for home buyers. Take advantage of it.