WASHINGTON – June 18, 2012 – It’s not something that economists routinely track,
but it provides a rough sense of what’s happening in local real estate markets.
Call it the lowball index.
A year ago, according to researchers at the
National Association of Realtors (NAR), one out of 10 members surveyed in a
monthly poll complained about lowball offers on houses listed for sale. In the
latest survey – conducted during March among a sample of 4,500 agents and
brokers across the country and not yet released – there were hardly any.
Instead, the focus of volunteered comments has shifted to declining inventory
levels – fewer houses available to sell – and multiple offers on well-priced
listings.
A lowball offer typically involves a contract submitted to a
seller where the price proposed by the purchaser is 25 percent or more below
list. Lowballs increase sharply when there’s a glut of properties available,
asking prices are out of sync with local economic realities, and values are
depressed or uncertain. Buyers figure: Hey, why not? Maybe I’ll get
lucky.
Based on the latest survey results, that sort of strategy is not a
winning move in many communities this spring. In fact, in local markets where
inventories are tight and competition for homes rising, realty agents say that
buyers looking to steal houses by lowballing their offers are ending up at the
back of the line – their contracts either rejected out of hand or countered
close to the original asking price.
READ THE REST OF THIS ARTICLE
Reprinted with permission. Florida Realtors®. All rights reserved.
Learn More About this Property
