Homeowners work tirelessly to generate interest in a home they are trying to sell. Once they get an offer, however, they often are not sure how to evaluate an offer.
How to Evaluate an Offer for Your Home
You have read every book under the sun. You have read more internet articles than you can imagine. You have cleaned up your home, made repairs and put out your marketing. At this point, you feel like you are an expert in the process. Suddenly, you get an offer on the property. Now what?
The first thing to do is relax. Do not make the mistake of rushing to evaluate an offer. An offer is just that – an offer. It has contingencies and all kinds of little quarks in it. Although you may have lived in the home for a long period of time, you need to realize you are now in a business transaction. Once you have gathered your thoughts, it is time to consider the offer.
The first issue when it’s time to evaluate an offer is always the offer amount. The offer amount will never be what you are asking for in the listing. It will almost always be lower than that number, perhaps shockingly lower. At this point, you may feel the urge to pick up the phone and give the buyer a piece of your mind. Don’t! This is a business transaction. The buyer is merely throwing out a bit of bait to see if you are going to bite. If you do, they get a great deal. If you don’t, they will evaluate any counter offer you make. If you do not counter, they can always submit a higher offer. Remember, this is a business transaction, not an assault on your pride!
A second issue when it’s time to evaluate an offer involves additional items in the home the buyer may want included in the sale. I have seen brawls break out over a lamp that would make a biker blush. Maybe that lamp is an heirloom that you can’t part with, but it probably is not. Only you can decide how valuable it is and whether it is worth losing the sale, but try to be objective and coherent when making the decision.
After this, the next issue when it’s time to evaluate an offer is you need to evaluate any additional costs associated with the offer. The buyer may want allowances for painting and so on. It is usually fairly easy to bypass your emotions on this one, but you need to make some basic financial calculations. Take the offered price and subtract all costs for the transactions. One you have the net revenue figure, compare it to the bottom line number you decided on when you first decided to sell. This will tell you if it is an offer you should accept.
Homeowners often get so focused on the selling process, that they are caught off guard when an offer actually rolls in. Stick to your guns and on your bottom line and you should be fine.
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