Sc, Home Buyer in Brooklyn, NY

Hello, I am making an offer for a property that according to my searches, the asking price of the house is

Asked by Sc, Brooklyn, NY Thu Jun 5, 2008

very fair. However, the seller's agent keeps on telling me that for me to get the property, I have to put in an offer that is near the asking price as he said there are many people who wants to make an offer. How can I know if this is true or not. Is the agent bluffing for me to put in an offer at close to the asking price? Thanks for any help on this matter.

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BEST ANSWER
Sc,

You're dealing with a representative of the seller, that is, the listing agent's responsibility is to do everything within their power (honestly and fairly) to get the most money for the seller. They have all of the information. If you are not using an agent, or someone with access to the same data as the listing agent, then you basically have no reliable information about what the home is worth.

While you and I would like to believe the listing agent is complying with their code of ethics, I often find myself wondering if that is really true. If they say there are many people wanting to make an offer on the home, and the home just came on the market today, then wait a couple of days. Then you'll know what you're dealing with. Either the house will go under contract or it won't. If it doesn't, you know you can no longer trust anything the listing agent says, period! And you only need to wait 2 or 3 days at the most to prove your case.

If it does go under contract, did you really want to get into a bidding war over a piece of real estate? That's what gets people into trouble in the first place.

The seller signed a listing contract with the listing agent that specified a commission to be paid. If you don't have your own agent, then 2 bad things happen. No one is looking out for your interests, and the listing agent is going to pocket money that could have gone to someone who could look out for your interests.

Go find yourself a really good buyers agent to represent you. Ask them to determine what the property is worth based on the available information (most of which you don't really have). Then have them negotiate on your behalf.

Good luck,

Jeffrey
0 votes Thank Flag Link Thu Jun 5, 2008
Dear Sc,

It's often difficult deciding what is a good offer to make when you find a house you like.

Before you make offers, you have to know your maximum financing amount/purchase price. Certainly, you must pay closer attention to your own bottom line than to what the agent or the seller wants.

First things first: when making an offer, focus on what your monthly payment will be for the mortgage financing, including taxes and insurance. If that payment is within your means, then your Mortgage Banker will determine the maximum loan/purchase price for you based on all the factors of the monthly payment, your down payment and your mortgage qualifications.

Begin making an offer with the following standards:

1. WISH LIST. Does the home meet MOST of the requirements from your Dream-Home-Wish-List? The Dream Home exists only in our minds; it's NOT out there waiting for you to stumble across it one Saturday afternoon. But you can find the right home using your Wish List. When you find the home that meets most of your requirements from the wish list, then it's time to make an offer.

2. FORGET LIST PRICE. Based on your own research, shopping in your chosen area, select the price you're most comfortable with, regardless of list price/asking price. In other words, you'll find a home listed at $268,000, but you've seen at least a dozen other similarly constructed homes in the immediate area priced or sold at $235,000. What makes this home so special that it's priced $33,000 more than the average price? Remember, your Lender will appraise the home based on similar homes and those prices.

3. MAXIMUM OFFER. Never exceed the price based on your mortgage qualifications, no matter how much you LOVE the home. You have to be able to afford the payment for the next thirty years. That in-ground swimming pool you love isn't going to pay the mortgage for you!

4. OFFERS ARE NOT PERSONAL. An offering price can NEVER be misconstrued as an insult to the homeowner. This is business; you're not going to hurt anyone's feelings! Make the offer based on a price you're most comfortable with!


5. OPENING OFFER. NEVER open with your maximum offering price. Test the waters with your opening bid: you want to see if this Seller is a SERIOUS Seller who understands this is a BUYER'S MARKET. If there's no reaction to your offer---assuming the price you offered is within the reasonable range of current market prices---you may be wasting your time with this home/Seller. It might be time to move on to another home.

See my "Five Steps To Making An Offer" for the best way to negotiate on your home purchase.
http://www.tcurranmortgage.com/2010/04/09/five-steps-to-maki…

Trevor Curran
NMLS #40140
0 votes Thank Flag Link Tue Jun 19, 2012
Don't listen to the seller's agent. There always are "other buyers" and "other offers higher than yours". I have been through this scenario a few times, and guess what, it's mostly a game. Hold on tight, don't let the agent ride you
0 votes Thank Flag Link Wed Aug 27, 2008
Hello, it is an agents fiduciary duty not to lead a buyer falsely or he or she can jeopardize their license. Let the agent know this and see if they come clean or not. But there is no way for you to really know what is going on behind closed doors, you just have to hope you have an honest agent.
Web Reference: http://www.KandHhomes.com
0 votes Thank Flag Link Wed Jul 2, 2008
SC its quite simple.

Go ahead and ask this broker if your offer has been dismissed? I personally hate it when brokers try to tell me and my seller that you should put in a higher offer because we have interest and people want to put offers. "I don't care that they WANT TO place offers, until they do, don't tell me that you have any real interest". I'm sure that some brokers are softer and play around, I don't. If they have a real offer which is higher than yours, the selling broker has to tell you that they had another offer and if you have any chance left, your offer would need to match theirs ( if you have better financials ) or you would have to make an offer that is above the other buyer.
Don't get into that WANT TO MAKE OFFERS game. Some properties that supposedly people wanted to make offers on that I saw, are still sitting out there with out any real offers.

Best of Luck.
0 votes Thank Flag Link Mon Jun 30, 2008
This is a clear example of why you need a Realtor representing your best interests and not those of the Seller. If there is in fact another offer coming in I always advise my clients to Make the highest offer they can which will not leave them dissapointed if they lose the home to someone else that offers more.

I can not emphasize strongly enough that you should have a Realtor assisting you with this transaction and looking out for you, not the Vendor.
Web Reference: http://www.scotleaf.com/
0 votes Thank Flag Link Sun Jun 15, 2008
BEST ANSWER
I think my colleagues have offered some great insights into how to handle your current dilemna. However, I think it fitting to bring to your attention that a code of ethics by the National Association of Realtors does not supercede Article 12A of the Real Property Law in New York State, which stipulates that an agent owes their client undivided loyalty, among 5 other duties that comprise their fiduciary role.

You should make your offer in writing, accompanied with your lender pre-qual or pre-approval. Request the seller's agent to furnish his disclosure of agency relationship, indicating the seller has retained him/her as his agent. Request copies of the documents you sign, as well as a copy of the agency disclosure and request an answer to your proposed offer to purchase by no later than 72 hours.

This should help you arrive at a reasonable conclusion of the Agent's capacity, as well as the seller's motiviation.
Web Reference: http://www.CorleyRE.com
0 votes Thank Flag Link Sun Jun 15, 2008
There is a form you can have your agent submit to the listing agent as proof that the owner has seen your offer.

Henry
917-497-0729

http://www.QueensLIRealtor.com
0 votes Thank Flag Link Thu Jun 5, 2008
As many people have said, you should be looking for a Buyer's Agent to represent you. It should not be too late. Have you already put in an offer in writing? If not, a Buyer's agent should be able to look at the comparable listings and sales in the area and help to counsel you on what offer would be best. If you do not get the house with your first offer, most liekly they will give you a counter-offer and you will have another chance. If you need help to contact an agent in Brooklyn, I can help you with that. Please feel free to email me at sarah@rjsmithrealty.com. Good luck!
Web Reference: http://teamrjsmith.com
0 votes Thank Flag Link Thu Jun 5, 2008
As a follow up to this question. Can I find a buyer's agent at this stage of the process? If so, where should I look for one that is in Brooklyn, NY?
0 votes Thank Flag Link Thu Jun 5, 2008
Hi Home Buyer in Brooklyn there are many ways to determine the value of a house and the only one that matters is yours. You stated the asking price is very fair, not just fair. That must mean there is something particular that is attracting you to this house. Because you have made reference to asking price I assume you have been looking at comparable properties and find this one more attractive than some others. Sometimes it is not just about the dollars! I had one couple that had to have a house because it reminded them of their childhood home, others like being close to family or schools. Sometimes people like the outdoors, want a garden, want the sun on the pool, or a shaded place to read in the late afternoon. The value to you may be more important than just the dollar and cents. If you can see yourself in this property for the duration of a few years or your life, than do you really want to wait a few days and find that you missed the opportunity for a few thousand dollars. If it is a fair price and you like it...buy it! Not everything in life has to be weighed so precisely. There is a time in life, where you have earned the right to say this is what I want and then get it! And it is such a bonus, when everyone feels good when the transaction is complete. If you chose to work with the listing agent, the listing agent would then be a dual agent and have responsibilities of confidentiality to you and the seller. Ask the agent how would thier representation be defined.
0 votes Thank Flag Link Thu Jun 5, 2008
Ask your realtor to show the Code of Ethics by which s(he) is bound. The agent must submit all offers unless the seller's have in writing given the realtor specific instructions not to. If you want to make an offer and the seller's agent will not present it, then find a realtor that will work on your behalf. I also suggest finding a realtor that holds the Cerfified Residential Specialist certification. They are well educated and have proven to be top professionals in the market place.
Web Reference: http://www.crs.com
0 votes Thank Flag Link Thu Jun 5, 2008
You have no way of knowing for sure, but most Realtor Association have a code of eithics which keeps honest agents honest. If you do not wish to offer the asking price don't let that stop you from offering what you feel is fair, if the agent doesn't actually have other offers you may get the property.
0 votes Thank Flag Link Thu Jun 5, 2008
You should be talking to your own agent,, not the seller's agent. And if you don't have your own agent, you should get one immediately.

As for whether many people want to make an offer: Maybe, but unlikely. If the price is really terrific, it's possible. But what that sounds like is that the agent hasn't received any offers. If people want to make offers, then they make offers. And you have to listen very carefully to what some agents say. For example: "I'm expecting some offers to come in on this property." Well, sure. You may interpret that as meaning "come in today or tomorrow." If the agent has a 6 month listing, the agent technically may be saying "some offers to come in within the next 6 months, probably after we reduce the price." Big difference.

As for the agent telling you that you "have to" put in an offer near the asking price....absolutely not. You can put in any offer you want. It's up to the seller to decide whether your offer is acceptable to him/her. And without any other offers on the table, in reality you're not competing against anyone.

What you need to do is determine the real value of the property. You say you've done "searches" indicating that the price is "very fair." And you may well be right. But your agent will be able to give you a second, very informed, opinion.

Good luck.
0 votes Thank Flag Link Thu Jun 5, 2008
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
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The real question is how bad do you really want the house to put an offer on it in the first place. If he is saying there are many people wanting to make an offer that isn't really saying anyone has made an offer.
There is no way of really knowing whether this agent is telling you the truth, I would highly recommend having an agent represent your interests though. Good Luck.
0 votes Thank Flag Link Thu Jun 5, 2008
You can save money to hire another realtor to represent you. The listing bokers duty is to get the seller the most money.
0 votes Thank Flag Link Thu Jun 5, 2008
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