I am getting tired of industry "experts" and pundits on television and national media such as CNBC and CNN suggesting to offer 80 percent of the listing price.
Obviously it is a buyers market nationwide, but every region and city is different including our city in Philadelphia .
The dynamics are changing - there are no rules. Every deal and every listing is a case by case basis.
We just had one of buyers suggest to only see properties that are on the market for sixty days or longer or with at least one price reduction. This strategy may make sense but if we did that, he would miss out on the properties that are priced to sell ! Further, a lot of the inventory that is sitting out there is from sellers not willing to bring their price down anyway.
I have seen on my listings numerous times crazy low offers coming in on properly priced properties. Im not sure what the buyer agent was thinking spending a lot of time writing up an offer for a client that has a buyer with unrealistic expectations ???
The paradox is that sometimes 80 percent of the listing price will result in a deal but what if the listing price was 20 percent above market value ?? !!! Who got the "deal" in that scenario ?
It seems to me that the agents and sellers that priced the properties to sell are the ones that obviously will sell first.
Thus, with every deal, it will be a case by case situation, depending on the motivation of the seller in terms of what deal they will accept.
My wife and I just bought an investment piece in Bridesburg. There were multiple offers - we offered a $1,000 more than the listing price which enabled our deal to get accepted. Even with that, I believe we got that property at a 15 to 20 percent discount to the market per se. If I would have taken an unrealistic approach to procuring that property, I would not own it today !
So when a buyer says I want to offer 80 percent of the listing price in the Philadelphia market I will ask what channel were you watching ? CNBC or CNN ? What will you say ?
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