A "How To" video, 16 mins... seems decent.

Here is a link that might be useful: How To Make a Lowball Offer

I watch the HGTV show "Buy Me." I am always amazed at people offering tens of thousands--even over a hundred thousand dollars--below asking price. It seems like coming up with an offer price is now more about "how low can we go?" rather than "is the asking price in line with the comps, and what work needs to be done on the house?"

We looked at a house listed for $55K, on the market for less than four weeks. My dad told me we should offer $35K for it as a jumping off point. I told him he was insane and that if we made an offer that low the seller probably wouldn't sell to us even if we came back with an offer above asking.

ical171, it is all relative. I've lived in the northeast and you couldn't get a closet for $55K. Median price in our last town in MA was about $800K, so not unreasonable to make offers of $100K+ below asking for houses in the seven figures. Our future relocation options are NY city or Los Angeles ... unfortunately not much in the $55K range!

I think this comment below the first linked article by Redfin has some merit.
Whether a buyer or seller is "greedy" is just what side of the fence your on. There's a buyers psychology too - buyers are worried that the economy and housing market is going to stay flat, no return of rising house prices - so anything they buy has to be a really good deal because if they aren't careful they could easily end up with a house worth less than they bought it for. In areas like I'm in I think that could easily be true. In the NW maybe not so much but buyers are still worried.

"Where were you when the housing prices were going through the roof? I did not here anything about buyers sensitivity and having to pay ridiculous prices with no equity buy in. This article's advice is self serving and appears to be trying to preserve high prices using the 'feelings' of the buyer as an excuse."

A house (or anything for that matter) is only worth what someone is willing to pay for it. If the only people that make an offer, make it at 20% off list, then maybe that's all it's worth. If it's worth more to the seller, then let them hold onto it. Simple market forces.

Just because someone makes an offer for 20% off list, doesn't mean that is all it is worth. This simply means that the current person(s) making the offer think it is worth to them (maybe looking for a good deal). If it really is worth more (or seller thinks so), then seller should see future agreed upon sales price/offers be in line with the market price.

I had a lowish offer and held on for what the place was worth. Several days later someone offered for quite a bit more than the original party was willing to pay.

Add to all this the scariness of the current market and some sellers will sell for less that the current market value, just to sell. This in turn brings the comps down. On the other hand, some sellers think the place is worth more than actual market value, then get stuck with a home on the market for a long time and eventually have to lower the price.
It's tough. Bottom line, Thou must know thy market value.

I'm on a couple of agents lists - they email me the latest listings in certain areas. I get repeat listings daily, listed as "new" due to a price decrease. Sometimes the decreases over a month have been over $100k. I'm in L.A. County. What does that say to me? If I see one I want I'm going to lowball!

This is a business transaction, not a church social.

"Thou must know thy market value."

Amen to that. For an agent working with buyers (owner occupied vs. Investors), educating the buyer about home values is the most important aspect in making an educated decision.

Totally agree:

"Where were you when the housing prices were going through the roof? I did not hear anything about buyers sensitivity and having to pay ridiculous prices with no equity buy in. This article's advice is self serving and appears to be trying to preserve high prices using the 'feelings' of the buyer as an excuse."

As a seller it helps to know the "bottom line" of what you want (and need) to take from the sale. I did my own analysis of what the comps are in my area, (West Los Angeles)and what my tax implications will be, closing costs, payoff to mortgage company, basically out of pocket costs. After arriving at my bottom line I took into account what the property needs and what will be negotiable after the original offer is submitted (and hopefully accepted.) I didn't go crazy in my asking price knowing the economy and also know that it's going to be easy for the BUYER to secure a loan in this environment.

So far, so good. After 1 week I had mulitple offers (one very low ball-eliminated right away) and the other 2 worth accepting. We countered, 1 met my counter, the other offered more than my counter.

We entered escrow 2 weeks to the day of listing. Of course we all know the hard stuff is ahead...but in this climate I don't think I would "low-ball"...I would give a price somewhat close to the asking, (after walking the property several times noting things that need to be done).

To me both as a seller (currently) and as a buyer (several times) that makes the most sense.

~Susan

It doesn't make sense to offer close to asking price in many markets right now. WLA and my southbay area are pretty stable but Nevada, Florida and a few other areas are totally and utterly in the crapper, with seller denial still in full force and very little selling.

I was looking at a listing in Reno on Realtor the other day, and I clicked on the virtual tour. The price listed on the virtual tour page was $300,000 more than what was currently listed in the MLS. It had dropped at least that much in a few months. Homes over $600k in that market are not moving. All hell has broken loose.

In that market it is not prudent to automatically offer close to asking price.

On the other hand, like I mentioned about the south bay - nice clean homes in the beach cities and the hill are still going for close to asking, albeit taking longer to sell than the heyday. Listings are still getting multiple offers.

Buyers and sellers, know your micro-market and what the market will bear right now.