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Old 07-13-2016, 01:04 PM   #1
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Cool ' lowball offer ' - is there such a thing... ?

To all Buyers.

Do you feel that an offer has to be within certain guidelines to be considered by the seller? If yes, why? What is the ' decent ' offer?
I am asking this ' newbie ' question, because I have been told in both occasions now, when I made an offer in writing, that I am not serious. Why am I not serious? Just because the seller does not like the number I provided?
I know now that a deadline can be put on any offer and it will quietly expire, when the seller does not make any counter. I still disagree with that. Negotiation is something we all do in our lives; to get hired, in business, with spouses, with our kids, etc. So, why am I ignored, when I want to get the feel of the seller and start an honest negotiation on a property? It happens in real estate, it happens at the dealerships, almost everywhere. In the boat business, this is not very common, I am told.
If get a counter, any size, I would get a message about the seller, how far he wants to go with the compromise. I might change my number accordingly and we can inch closer and closer to the final price. If I don't get anything back, except a note that I am ' not serious ', I feel insulted. Anybody should be able to state their position without judging someone else. There is no harm to come back with a counter, which is way out of my range, and we just say thank you and wish you well to each other. At least, this is what I would do, if I wanted to sell my property. I don't have one, yet, but it can happen some day.
I know that we all want to sell for the highest price and buy for the lowest price. But who set these standards for 3-5-8 % only limit on an offer? Business is business. We all want to make the best of it. How can I do it, if I get no communication and being ignored?
I remember, close to 40 years ago, when I first visited the Bazar in Istanbul, Turkey, as a young deckboy/O.S., I received a quick education from the shop owners and my senior sailors that negotiation is a must. A shop owner will not even talk to you, no matter how stupid foreigner you are, if you are not willing to negotiate. That is the charm of doing business. Money too, of course, but over there, nobody was offended, if I gave a 15-20-30-50% off price offer. We were all smiling and laughing and everybody had fun. Of course, they ripped me off, no matter how smart I was trying to negotiate, but at least, we had mutual respect and lot of fun.
Obviously, buying and selling a boat for many 100Ks is not a bazar item. I know that. What bothers me is judgement and ignorance. Give my your ' counter ', I'll consider it, I will counter it, and at the end we might just stay friends without spending any money.
In my case, the selling broker told to my buying broker that I was not serious and the seller does not even want to start any communication with me. I find this disrespectful.
I moved on and I will live, so no anger here. I just want to understand other people's thinkings. Please, educate me, where am I wrong? Thanks.
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Old 07-13-2016, 01:11 PM   #2
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If a seller gets an offer that they consider "too low to be serious", they won't give you a counter because they feel it is a waste of their time. If they are listing their boat for $300k and get an offer of $200k, they figure there is no way that the prospective buyer would come close to that bottom line mystery number they have in the head of $270k. So they ignore it.

Folks are busy. They don't want to waste their time with buyers whom they feel there is no chance of coming to an agreement on price. To make a counter, they still have to have their broker write up the counter, sign it, etc....
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Old 07-13-2016, 01:12 PM   #3
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I think if a broker is telling you that...you might be well below market and if the broker is the list g broker, might have inside knowledge of where the seller is willing to go. They may also know the mindset enough to know whether it is an insult offer based on the boat and it's condition.

If a seller says it is not serious...it is their perogative but will sometimes change their tune with time and no other offers.
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Old 07-13-2016, 01:18 PM   #4
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I LOVE to negotiate, but there are limits. If I was selling a car for $20k and you offered $1, I would not consider you a serious buyer. What would I consider a serious offer? I don't know, but I know there is such a thing as too low.

If you like to bargain and are a reader, I highly suggest the book Influence: The Power of Persuasion. Your topic is covered in the book. It's a really good book.

https://www.amazon.com/dp/006124189X...7SNQDK54GBGQQR
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Old 07-13-2016, 01:23 PM   #5
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Around the world (Except in the US) buying and selling is a game played by the buyer and the seller, and as utazo89 said "Negotiation" is the name of the game. It seems that here many people do not know how to play this game, or are not willing to.
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Old 07-13-2016, 01:35 PM   #6
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Refusing your low ball offer may be their way of countering. Simply, your offer is too far below the threshold. Try again; submit as many times as you like; I'll counter when you cross the threshold. If my broker told me to counter a ridiculous offer, I would counter a dollar lower than asking price.

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Old 07-13-2016, 01:49 PM   #7
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People are willing to negotiate with someone they feel acts serious. If you think my boat is priced 25-50% or more too high, good luck talking me down. Go find what you feel to be a more realistic priced seller to work with.

Oftentimes boats can be listed for an unrealistically high price by a seller with no motivation to sell. They'll sell if they get near that price. Newbie buyers often can't see the forest for the trees and pass on more "expensive" similar boats that are likely better "deals" because they are in superior shape to the lower priced comps.

Alas, if ultimately nobody is willing to negotiate it may be time to examine the common denominator. Just some random thoughts.
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Old 07-13-2016, 01:50 PM   #8
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What is a "Low Ball Offer"? Over the past few years that my wife and I have been looking for liveaboard boat that suits our needs we have seen many boats that are the same make, model, and with in a year of each other, with the same equipment, with an asking price difference as much as $40K. Now I know that everyone has a different opinion of what things are worth, but that big of price spread ? Would making an offer of $40K below asking price of the higher priced boat be considered a "Low Ball Offer"?
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Old 07-13-2016, 01:51 PM   #9
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Why not make a full price offer on the lower priced boat?
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Old 07-13-2016, 01:56 PM   #10
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Originally Posted by mramoo View Post
What is a "Low Ball Offer"? Over the past few years that my wife and I have been looking for liveaboard boat that suits our needs we have seen many boats that are the same make, model, and with in a year of each other, with the same equipment, with an asking price difference as much as $40K. Now I know that everyone has a different opinion of what things are worth, but that big of price spread ? Would making an offer of $40K below asking price of the higher priced boat be considered a "Low Ball Offer"?
On a $400k asking price? No. On a $140k asking price? Probably.

You can always submit an email or note with your offer explaining what comps you used to come up with your offer. However, if you have two similar boats, one asking $100k and another asking $140k and they are truly equivalent, then buy the $100k boat and don't bother with the $140k boat. Amazing how buyers like to say that an asking price is too high by comparing the boat to other boats that they are NOT making offers on.
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Old 07-13-2016, 02:07 PM   #11
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Why not make a full price offer on the lower priced boat?
Love this
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Old 07-13-2016, 02:09 PM   #12
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Insult offer.... I think that is what I was trying to dance around.
My point was, there is no ' insult offer ' in other countries.
I am not judging anyone's act, just trying to get the picture about the system here.


[QUOTE=psneeld;460276] enough to know whether it is an insult offer based on the boat and it's condition.
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Old 07-13-2016, 02:27 PM   #13
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Insult offer.... I think that is what I was trying to dance around.
My point was, there is no ' insult offer ' in other countries.
I am not judging anyone's act, just trying to get the picture about the system here.
I see what you are asking I think. If a seller gets insulted or offended by an offer that is their problem. They can ignore it or they can counter it, but they have no reason to be offended by a low-ball offer.
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Old 07-13-2016, 02:30 PM   #14
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Insult offer.... I think that is what I was trying to dance around.
My point was, there is no ' insult offer ' in other countries.
I am not judging anyone's act, just trying to get the picture about the system here.
If your asking price is twice your bottom line, I can understand that kind of culture. I'm guessing most brokers and sellers in this country aren't pricing that way. With a low ball offer they may assume you lack the financial ability to tender a serious offer. BTW, if you know your low ball offer is no where near what they will accept, then it's not serious is it.

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Old 07-13-2016, 02:40 PM   #15
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Following this with great interest since we've found the type of boat we want and will be looking at different ones.
Now what if a buyer submits a "lowball" all cash offer?
I'm thinking if a seller has had one or more offers fall through because of financing or other reasons then they may be more willing to accept a cash offer.
What do y'all think about that concept?
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Old 07-13-2016, 02:49 PM   #16
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Ted.

I would never make and offer, if I did not have the financing in order. My offer was 20% below the asking. I know that is quite high %, but not unheard of. I am not brave enough to start 40-50% below asking. Some are.
It is not always just about what the seller thinks the boat is worth. Sometimes situations, life changes can push a deal to a lower price acceptance (age, health, upkeep, another boat bought, divorce, marriage, etc.) Me, as a buyer, possibly cannot know, if that is the case. Maybe the listing broker does. So, as an outsider, why should not I do an offering very low first, and adjust it later, as it goes?



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Originally Posted by O C Diver View Post
If your asking price is twice your bottom line, I can understand that kind of culture. I'm guessing most brokers and sellers in this country aren't pricing that way. With a low ball offer they may assume you lack the financial ability to tender a serious offer. BTW, if you know your low ball offer is no where near what they will accept, then it's not serious is it.

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Old 07-13-2016, 02:50 PM   #17
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Originally Posted by mramoo View Post
Around the world (Except in the US) buying and selling is a game played by the buyer and the seller, and as utazo89 said "Negotiation" is the name of the game. It seems that here many people do not know how to play this game, or are not willing to.
That's true, maybe. But when I lived in Germany they had their way, and when I lived in the Dominican Republic, they had a very different way. I didn't see either of them as particularly knowledgeable about or even particularly willing to play the game here either. The game of negotiation in the US varies so widely as it seems based on the cultural habits of the numerous immigrant generations whose methodology is as varied as the cultures they come from. Still, when equal consideration and some initial respect is injected, I never met someone who I couldn't negotiate with or that couldn't negotiate with me in any culture.
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Old 07-13-2016, 02:58 PM   #18
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Did your broker make a suggestion to you as what he thought fair market value of the boat was?
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Old 07-13-2016, 03:04 PM   #19
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As long as I have been studying the boat market in the PNW I have seen boats that sit on the list for a year or two before lowering the asking price. Then the boats get the "Sale Pending" note on their listing. That tells me that the boats that just sit on the listing are overpriced. They may be getting offers, and rejecting them, or not getting offers at all.
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Old 07-13-2016, 03:07 PM   #20
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Ted.

I would never make and offer, if I did not have the financing in order. My offer was 20% below the asking. I know that is quite high %, but not unheard of. I am not brave enough to start 40-50% below asking. Some are.
It is not always just about what the seller thinks the boat is worth. Sometimes situations, life changes can push a deal to a lower price acceptance (age, health, upkeep, another boat bought, divorce, marriage, etc.) Me, as a buyer, possibly cannot know, if that is the case. Maybe the listing broker does. So, as an outsider, why should not I do an offering very low first, and adjust it later, as it goes?
I don't consider 20% off of asking to be an unreasonable starting point. But then I bought when it was a weak economy / strong buyers market. Have a friend who just went under contract for a sailboat that had been on the market for 2 years. It was over priced. He offered 60% of asking and settled for 70%. He presented his offer with comps for recently sold identical base boats. So you never know.

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