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OCTOBER
2009
Earlier each
evening the dark of autumn rolls across
our valleys and creeps through the trees
of Northwest Montana.
Take a moment with a steaming cup of
your favorite brew and read this month's
View from the Chair, no tricks, only
treats! |
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October in Montana
October 2009
 There's
A Whole Lot of Dealing Going On!
Negotiating is a major Component for Finding
Success for Sellers and Buyers in Today's Market.
Negotiations aren't what they once were. Many agents
only know one negotiating style - take it or leave it.
Today's market requires much more sophisticated
negotiation skills as well as patience by the Buyer and
Seller. Negotiation is a critical agent skill that will
allow you to achieve the desired outcome - buying and
selling real estate on the best possible terms. Here are
a few successful scenarios we have been a part of in the
past few months.
Walk Away, Walk Back
Buyers today are very patient and are often willing to
negotiate for months to make the deal. This is
especially true during the winter months when buyers
often don't really want possession of the property until
spring time. We represented a buyer that made what the
seller considered at the time a low offer to which the
seller chose to not respond. The buyer was in no hurry
and decided to watch the market for a while. A month
later the seller's agent called to ask if the buyer was
interested in re-submitting the offer. The buyer was
interested and negotiated the terms of the transaction
from a position of greater strength.
Written Offers on
Multiple Properties
Many sellers in the current market have not reduced
their prices enough to entice buyers to buy. In order to
identify the truly motivated sellers, buyers must make
written offers to force sellers to respond or not. If
the seller doesn't respond or counters at a higher price
than the buyer is willing to pay, the buyer moves on to
the next identified property. This strategy works best
for the Buyer who is more interested in value than in
one particular property. As seller motivation changes
such offers may be responded to weeks and months later
in the form of a Reverse Offer.
Feeding Frenzy Pricing
For truly motivated sellers looking to liquidate their
property and frustrated with lengthy time on market one
successful option is to price the property so low as to
create a feeding frenzy among the ready, willing, and
able buyers in the marketplace. The idea is to get more
than one buyer involved, keep all the buyer's agents
informed of all other offers and create a bidding war.
Buyers are watching for bargains and there is pent up
demand out there. As a result this strategy almost
always results in a quick sale and a sale above asking
price. One example is 284 Gun Barrel Lane, Dayton, MT.
This 11.57 acre, 3744 sq-ft house property came on the
market on September 15, 2009 for $190,000. The seller's
agent accepted offers for a specified period of time
advising buyer's agents that the highest and best offer
would be accepted. The property closed on October 9,
2009 for $219,200. (Note: The seller's agent may or may
not divulge the details of the various offers to buyer's
agents.)
Sweeten the Deal
Another successful seller negotiating tactic is what we
call "Sweetening the Pot." The idea is not to reduce the
sale price but to add real value for the buyer in other
meaningful ways such as paying closing costs or loan
points, building a garage or including a golf
membership, furnishings, boat, lawn and garden equipment
or anything the seller has of value that they don't want
to take with them. Sweetening the Pot can also occur
during the counter-offer stage by offering such items of
value instead of a larger price reduction.
Reverse Offer
For sellers who've been on the market a while an
interesting tactic is to reconnect with buyers who
previously looked at their property but have yet to
purchase a property. With a reverse offer the seller
submits a specific offer to the buyer instead of
lowering their listing price to the general public. In
the past 30 days this has happened for two of our buyer
clients. The hope is that it starts a negotiation
process that might have never happened otherwise.
When the market is not in equilibrium, like now when
Buyers and Sellers find themselves very far apart,
negotiations become longer and more competitive.
Superior negotiating skills can give the needed edge to
achieve desired outcomes. Buyers, go after what you want
- you may just get it. Sellers, keep your eye on your
goal of selling and hang tough when you get that
"lowball" offer- stay in the game and you may be
surprised by unexpected success.
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Northwest Montana Real Estate
love montana. live montana.TM
