How To Make An Offer In A Transitional Real Estate Market

I got my start in the real estate business about four years ago - when the market in Austin, Texas could be described as "bad," "on the decline," "busting," or worse!!!  We preferred to describe it as a "buyer's market."  This way, it made the real estate buyer feel privileged - not foolish.  At that time, when I was lucky enough to find someone willing to risk the "buyer's market," we'd search high and low for weeks to find the perfect home - and then the question would come, "How low do you think we should come in?"

More often than not, in a buyer's market, we'd start at around 90-95% of the seller's asking price.  If we offered 95%, usually it was taken.  If we offered 90% - we'd usually go back and forth a bit until we landed at, you guessed it, 95%.  This was, of course, as long as the seller didn't have their home listed ridiculously above or below the Fair Market Value.

Well...the market is shifting, and I'm lucky enough to have sold quite a few homes to buyers willing to risk the "volatile," "buyer's market," that actually turned out to be a legitimate "opportunistic market."  Now I'm in the position to have helped quite a few people buy low and sell high - and I'm receiving quite a few referrals in the Austin Texas Real Estate market.  One big thing I've seen change is the way we come in with an offer.

In the Austin real estate market, we're in the funny position of just coming out of a bad, or "buyer's market" and not quite into a full-blown "seller's market."  The best way to describe our market, and the way we approach it, is "fair."  Seller’s & their agents understand that, if the home is priced correctly, it will sell in a reasonably short period of time.

Because of this, the general rule of “let’s come in 90-95% of their asking price” no longer applies.  If a home is priced correctly, and the buyer offers 90% of the asking price, more than likely the seller will tell them to either resubmit, or go away.  Likewise, if the buyer offers 95% of the asking price, the seller and their listing agent will likely come off the price slightly, but with the message that “we’re not moving much more than this.”

The bottom line is that a transitional market is a “fair market.”  Nothing is more important in a fair market than a home’s true Fair Market Value.  Because of this, it’s more important than ever to make sure that your real estate agent will complete a thorough Comparative Market Analysis.  Once that is done, and with the right real estate agent’s presentation skills, you might not have to negotiate – merely make one offer that is accepted.

Eric Bramlett currently manages his Steiner Ranch Austin Guide, his Austin Texas Real Estate company’s website, & his Downtown Austin Guide.

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