Home Buying – Should You Look For Desperate Sellers?
How can you tell a seller is desperate? It’s not easy but there are some indications. The questions is, as a buyer, should you look for those desperate sellers? A cautious approach is always a good idea and desperate sellers can be ideal for finding homes below market value.
Some indications of a desperate seller include a combination of the following:
- The home has been on the market for a long time
- The selling price has a history of steadily stepping down
- The selling price steps have become more frequent
- The selling price steps have become larger in value
These are not always indications of a desperate seller, of course. They may also indicate someone who simply overpriced their home and have been forced to become more realistic in order to obtain a sale. You should also inspect homes closely before making any offers. Drops in price can be an indication of problems within the property and that the owner wants to sell before the problems become to obvious or very expensive to repair.
If the sales price is getting larger and the drops in selling price are more frequent, it may also indicate a need to sell and close quickly for lifestyle reasons – for example, moving interstate. The seller often needs to sell in order to buy their new home so if work, school or some other time pressures are in play, you may be able to capitalize.
As a seller, you should never reveal to potential buyers any information that relates to a timed need to sell – that gives the potential buyer more ammunition to fire in a low ball offer. Of course, for home buyers, if you get a chance to talk to the owners, reasons for selling could well make their way into the conversation, couldn’t they? Should you capitalize on their need to sell? Perhaps you are doing them a favor by buying!
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