REAL ESTATE NEWS (Downtown Los Angeles) — As the real estate market cools in much of the U.S., it’s time for home sellers to break out all the stops when it comes to selling at the highest price possible in a reasonable time frame. #reverseoffer
One of the most advanced and under-used tactics is the reverse offer. This action is particularly useful when one or more prospective buyers have viewed the property, but have not promptly placed an offer. Experienced real estate professionals are aware that receiving offers is not only important for the obvious reason that it might lead directly to a successful sale, offers have other benefits.: An offer, high or low, helps attract other offers; offers help in negotiation and offers help give the seller more negotiating leverage.
To make sure that things happen, a reverse offer is given from the seller to the buyer. The seller proposes the price and terms desired after the buyer has expressed some interest. This can help a seller keep a buyer interested before they move on to another property, or if they are choosing between various homes. For the professionals who know how to use them, reverse offers are effective at increasing sales.
Some real estate agents consider the reverse offer to be their secret weapon because not every agent knows about the tactic. It’s a simple step that most agents and sellers overlook. The seller makes an offer to a prospective buyer, outlining the terms they will accept if the buyer will buy the home. It’s like common offers, except that the seller makes the first offer, not the buyer. This certainly is a roll reversal from what most buyers and their agents expect, but there is nothing wrong with that. It’s an uncommon move that helps beat the competition. After all, the goal is to get the house sold, not to worry about what everyone else does. The reverse offer is particularly useful in a buyers’ market like we have right now in Downtown Los Angeles.
The reverse offer is not something always used after every showing, but it can work successfully when a buyers’ agent says something like, “They are choosing between two condos.” Typically the buyers have been back in the home multiple times. It’s part of maintaining open communications with the buyers’ agent. And it has a proven track record of success for real estate professionals and sellers.
Having the Reverse Offer weapon in the agent’s arsenal does not mean we can escape real estate basics: the home must be priced well for current market conditions; there must be an effective marketing campaign to attract buyers; and the home must be in excellent shape because the majority of buyers do not want to do any work.
It’s very common for home buyers to get overloaded and overwhelmed by seeing too many properties. They end up forgetting some of their favorites. If we can move the buyer one step closer to choosing the right property by making a reverse offer, we are really doing both parties a favor.
In this changing market, it’s imperative for sellers to get smarter and more strategic, turning the transaction on its head to get buyers off the fence with this phenomenon called the reverse offer. Here are helpful hints for making successful reverse offers:
• Give the buyers a short period of time to respond. The power of a reverse offer comes from creating urgency where the buyer currently feels none. Extend a reverse offer with a warning that it is only good for a day or two, to push the buyers into moving quickly. If the reverse offer is given to multiple buyers, let them all know that this is the case and that the first buyer to respond gets the house.
• Reverse offers work great to cut the competition, especially if the home is nearly identical to neighboring homes for sale at the same price. A proactive, reverse offer differentiates the home in the minds of home buyers as it captures their attention.
• If one buyer has viewed the home repeatedly, check in with their agent before making a reverse offer. The listing agent should contact the broker for any buyers who have made more than one visit to the home, and inquire into what is keeping them on the fence. This will boost the likelihood of making a successful reverse offer by making sure the offer addresses the issues that have made buyers hesitant to place an offer.
The reverse offer doesn’t have to chop a huge amount off the home’s list price to be effective; a percentage point or two should be enough.
Selling a home in today’s market is a competitive sport. Now, more than ever, sellers need to get proactive and take advantage of every opportunity to find a good buyer. Home buyers appreciate when a seller is willing to go the extra mile to help them solve the problems that are stopping them from buying a home. By using a reverse offer in this way, the seller increases their chances of getting a great buyer that would otherwise have been missed.
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