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Bypassing the agent and offering directly to Owner

Discussion in 'The Buying & Selling Process' started by Skilled_Migrant, 29th Mar, 2016.

  1. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    I intend to put in an offer in a sealed envelope and hand it over to the agent to take it directly to the owner.
    Reason: Low ball without putting the agent in the sticky situation as he has already conditioned the owner and the asking price has been reduced by 15%. This way the low offer is not REAs responsibility and the offer still gets communicated to the owner.

    Opinions for and against.
     
  2. neK

    neK Well-Known Member

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    And why wouldn't the agent open it?
    If I was the vendor, I would expect the agent to open on my behalf - its what I am paying them for - Unless the notification WASN'T an offer, at which point I would have to question why it's coming through the agent.
     
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  3. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    You'll irritate the agent. The owner will still need to inform the agent of the offer.

    Unless the agent isn't doing their job properly, I don't know that bypassing the agent really helps you that much.
     
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  4. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Sounds strange.

    I couldn't see an agent going to the vendor with an envelope - it undermines them.

    Your offer will be accepted/rejected regardless of how it's delivered IMO.

    Cheers

    Jamie
     
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  5. Marg4000

    Marg4000 Well-Known Member

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    You will also irritate the vendor. If the vendor wanted to deal directly with buyers then he/she would not have engaged a RE agent.
    Marg
     
  6. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    • It is Personal & Confidential for the owner only. I could go one step further and send it by registered post, but want to keep the agent in the Loop.
    • I should have phrased it better "Is it legally binding for the agent to know the offer, when the buyer is refusing to disclose it"?
    • The agent is under instruction not to discuss the offers below a certain value which is higher than what my DD tells me.
    • It will prevent an outright rejection of a low ball offer at the agent's level and even if agent takes a verbal / disclosed offer to the vendor, it will save the agent the embarrassment of submitting a low offer.
    • At the least it gets the ball rolling on negotiation at a lower base.
    • Agree with the undermining part, but it liberates them from the responsibility of following the vendor's instructions. I might be assisting the REA in softening the seller's expectations.
    • Most likely it will be rejected, but the rejection will be by the vendor and hopefully the negotiation can start at a lower price.
    • Apologies if it sound like breaking up with a text message.
    • That is the risk I am willing to take for a better price.
     
  7. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    I can see where you're coming from, given the agent has specific instructions regarding low ball offers.

    Think of what this means however. The vendor probably wants a particular price and doesn't want to be bothered with offers they're not going to accept. At this point in time they're probably not despserate to sell. A low offer won't get the property in the short term.

    Your offer won't be accepted, but at least it's on the table (assuming it even gets delivered). They might come back to it if the property doesn't sell and if they change their mind and start to take lower offers. Perhaps some good will come of it down the road.

    At this point you've still annoyed both the agent and the vendor. This may mean that even if they do take lower offers in the future, they may not come back to you.

    Perhaps a better approach would be to go to the agent and openly give them your offer. They'll say they can't take it to the vendor. Be understanding but let the agent know that it's still on the table should the vendor have a change of heart.
     
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  8. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Thanks @Peter_Tersteeg
    Good advice. Maybe I can discuss it with the agent and tell him that it is low ball (in the envelope) and just the start of the negotiation so maybe he is not so annoyed, as I am softening the seller for him.
     
  9. Marg4000

    Marg4000 Well-Known Member

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    I would hear that statement as "I know my offer is ridiculous but I am prepared to go higher".

    ?????

    You may do better to submit a reasonable offer (I.e., what you think the property is worth to you) rather than focus on playing games. If refused then walk away.
    Marg
     
  10. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    I'm inclined to agree with Marg. Make a low offer, but don't soften it too much. Let them know it's there and available, but stand firm at that.

    If they don't sell and come back to you, then is the time to negotiate. They'll probably already figure that they can get you up a little, but giving that consession now is too early.
     
  11. Chilliblue

    Chilliblue Well-Known Member

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    You could always copy in the vendors solicitor if you are worried the offer wont betaken seriously by the agent.
     
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  12. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Thanks for that, I did not consider the vendor's solicitor.
     
  13. Chilliblue

    Chilliblue Well-Known Member

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    It means that you are allowing the agent to continue to do their job and the owner is informed via another appointed party.
     
  14. willair

    willair Well-Known Member Premium Member

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    It may also work the other way,just by looking at it from the vendors side if they know what they are doing what a useless sales person that has to use a sealed letter with a low offer inside
    then it unexpectedly blows up in your face,when the vendor just throws the offer in the rubbish bin,and tells you both go away..
     
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  15. neK

    neK Well-Known Member

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    .

    I'm with Willair on this one. While it could go a number of ways, one of the possible scenarios is screwing you and the vendor up.

    You could always try building rapport with the agent so they keep your offer in mind and let them deliver the low ball value to the vendor in a manner that is non offensive to the vendor.
     
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  16. Rugrat

    Rugrat Well-Known Member

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    As a vendor who sold a house just a couple of months ago, I can tell you how the situation would play out for me.
    First, my REA would have rang to inform me of this envelope.
    Second, I would have told him to open it and read to me the figure, over the phone.
    Third, I would have laughed, said 'no' and told our REA to go back to work. Or possibly, if I was irritatable that day, I would tell them to not even bother dealing with you at all.

    We have a couple of low ball offers. One an entire 100k under the actual sale price. That person came back several times trying to negotiate, but I don't like to play games thats why I hire a REA. We simply had a laugh and told our REA not to bother us with anything from this person, unless and until they reached our price range. They eventually did come back with a reasonable offer at the end, but by then we had agreed to someone elses figure and were in the process of exchanging contracts and were not inclined to reneg, even for the 5k more they were offering.
     
  17. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Very diverse opinions....worthwhile to bounce the idea off many heads.
    Update:
    Spoke to the agent who has agreed to convey the low ball offer to the vendor.
     
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  18. neK

    neK Well-Known Member

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    Nice. Keep us updated on how it goes
     
  19. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Update
    Rejected by the vendor but the good part, it did reach the vendor.
    Thanks everyone
     
  20. neK

    neK Well-Known Member

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    Not over until property is sold.
    Never know, agent might be able to convince the owner to take the deal if everything else goes cold.