The five facts you need to know to make a low real estate offer stick.

Two things are always true in a real estate transaction: The seller wants the best offer he can get for his property, and the buyer wants the best deal he can get for his money. Considering how antithetical these two sides are, I'm sometimes amazed that real estate deals can come together at all. And real estate also includes a level of emotion not seen in other transactions. Sellers often come bearing an emotional connection with their home. How then, can a buyer make a "low ball" offer on a property without insulting the seller and squashing any chance for negotiations? Here are five things you'll need to know to get a low offer accepted.

1. Know your REALTOR?

A buyer's agent needs to use use their skills in convincing the listing agent why a low ball offer is good for his seller. The listing agent is the gatekeeper to the seller, and should also be their friend, confidant, therapist, and sounding board. That agent needs to be the focus in the negotiations when making the offer. Your agent is the one who will start the negotiations, addressing the seller's agent. His job is to convince the other agent that your offer is fair and viable. 

2. Know your seller's motivations to sell.

Money isn't always the most important reason a seller is on the market. A seller in a 4th quarter market with the holidays looming may also be motivated by time or flexibility in the deal. One clue to a seller anxious to sell is the listing history. If the seller has a history of dropping price several times over the course of the listing, possibly time is more of a motivation for the seller than money.

A seller is much more likely to consider a low offer if the buyer can meet their other needs. For instance, a seller may want to close by a certain date, or may need extra time after closing to button up their moving arrangements. A buyer can offer the seller to close early, or rent back after closing until the sellers find their next home. Keep in mind that your low-ball offer may cause funding issues for the seller, such as the ability to pay movers, afford temporary housing or adjust their own search parameters for their next house. If you make a low offer, try to show you also want what's good for the seller. This can be a way of saying ‘I care about you and your well being. Can't you see now how generous my offer actually is?’” 

3. Know your numbers

Have your agent have reason for your offer by bringing a specific list of comparative recent sales from the area that back up your offer. Get the seller to understand that the low ball price you are offering is practical, even if it isn’t. 

4. Know your funding is in place.

Don't put an offer on the table with questionable financing, or needing a contingency to sell your own home.

Nothing will put off all parties on BOTH sides of the table if you make them spend hours and days negotiating a deal, only to find out you don't have the money to make it happen.

5. Know what’s low

Not everyone has the same perspective on what a low price is. Especially if you’re moving to a new area, be sure you understand the values in the market. The median price for a house to sell in the United States is $229,000. In California, however, the median price for a home is $509,400. For someone moving to San Francisco from Des Moines, that price may be a shock, as the median home price in Iowa is $149,100.

Do your research on what the market is bearing in terms of pricing and do not get too ambitious in cutting the price. As always, work with your with your REALTOR?, who is an local area expert in the market in which you are buying. It will save save everyone involved time and energy. And keep in mind too that even knowing the facts we discussed above, you may still not get agreement on your offer, and be ready to walk away.