Why do people make extremely low offers?
Someone moving to this area asked me this question recently. They were selling their home in a competitive market. The home was in good condition and their property was priced in line with comparable sales from their neighborhood. They were under no pressure to sell immediately.
Yet they still received one offer that was $50,000 less than the asking price. (more than 10%)
And that was not all the buyers asked for.
This seller was frustrated and insulted. They said, “it's just annoying to me that people will waste their and my time this way.”
Over the last 10 years, I’ve come across myriad reasons why people feel compelled to do this and most of them will not make sense to you.
It usually results from something that they learned in the past that they still believe holds true. They might have seen it on TV, took a $2000 course on Real Estate Riches, or heard it from their cousin in Kalamazoo.
If this happens to you, my first advice is to not take it personally and be insulted. Getting mad does not help in this situation because this may still be a viable buyer.
You have a few choices at this point.
First, if you feel confident in your price as compared to the market, go ahead and counter at your list price. Or at least very close to it.
I recommend this option most of the time. If this is a bargain hunter it will be enough to make them go away. This tactic puts them back on their heels and forces them to get serious or get gone.
More than once I’ve seen a buyer change to a reasonable offer price.
Second, if the offer is ridiculously low (like half price), it’s probably best to reject the offer and not waste your time with a counter.
That buyer has watched too much HGTV.