Lowball offers are not exactly music to a seller's ears, but how you present your "underbid" can apparently make all the difference, according to a StreetEasy.com thread low on bravado and full of practical advice.
"A low ball sounds like a price that's way below fair market value," says one commenter in the discussion which includes a sample lowball letter to a listing broker. "I think here we are talking about a low offer as compared to the ask but not compared to the comps."
Preparation and patience are key. All agree you want to communicate in writing that you're a serious buyer, you have the money and the lawyer, and you're eager and ready to move. The ideal game plan:
- Make an all cash offer
- Don't put any time pressure at first, so the seller has time for the offer and the situation to sink in if, as you suspect, the property doesn't sell at the asking price. "Five stages of grief" is how one commenter described it.
- Come back later for a second round, possibly with a slightly higher offer and definitely with a time constraint. (From one post, for example: "I am renewing my lease for a year and am willing to wait another year to buy, I really do like your apartment but this is as far as I can go, I need to have a contract in hand within 2 weeks, before I commit to my lease.")
- Consider adding proof that you can close quickly: "Buyers will be able to close in X days, will legally commit to closing in X days, and will pay Y penalty/day of delay."
Opinions differed on providing comps to support your "underbid." The best suggestion: "Present a range based on some recent comps, telling the broker you would like to submit an offer and feel $x-y is where you are thinking, and how would the seller feel about that? A range opens up a conversation."
And conversation could end in a sale.