Hi there I have been liasing with a real estate agent regarding a property that I'm interested in and here is a bit of a background. Property is advertised without a price guide and I emailed asking rent, etc. They provide me details and ask what my budget is. I give them a range of $500k - $570k. They say that is "definitely in range". They then say property has been on market for 4 weeks with an expectaion of a higher price ($600k) and some interest but I assume no firm offers. Should I go into this and place a low ball offer or has the agent been attracted to the higher part of my budget range? Not sure how I should approach this.
Never tell them your budget! Check ksou house for recent sales in the area, and to see what the property sold for last time. Also if the house is listed on realestate.com.au Open the listing, hit ctrl-u, then ctrl-f, type in listprice and see if the agent has put in an actual price. I can't tell you what to offer, but low balling typically only works in slow markets.
You should do your DD & determine what you believe is fair value, then make an offer based from there. You should also not disclose your budget as it does not aid in your negotiation as now they know what you're willing to spend up to. FWIW, I normally don't bother with residential properties that don't have a price guide at all as that is what is normally referred to as "by tender" which is really just a silent auction. Each to their own. If you see value & believe you can negotiate a fair price, then perhaps play a little coy & non-commital. ... ie. Keep a poker face because you've already given away one tell that may indeed be influencing the agent's decisions moving forward.
Never tell them your budget! From your position now I would do your best to work out current market value. Researching similar properties that have sold recently etc. Once you have an idea of price, put a offer in writing, quick settlement or long settlement(whatever suits the vendor), submit the offer with a 24 or 48hour deadline. To get around the agent now knowing your budget I would maybe mention in passing that your broker has reassessed your situation and this is all you can afford. Best of luck.
Cheers guys. I probably realised after revealing my budget that it was probably the wrong move. In any case I'll see how I go.
I got nothing to add to this discussion but would like to commend you on your avatar. Go the Wanderers
OK so you've let your budget slip.. don't worry about it. Is this property an IP or PPOR? If IP it's easy, you make your initial offer, and eventually you might make another that is the maximum you think is fair to pay. Doesn't matter if it's less than the top of your budget range. You just tell the agent, this is my best and final offer, it's only an IP for me, and it's not worth me spending my maximum budget on. Of course you don't have to say anything, but it might let the agent know you're serious, and that you're not emotionally invested in the property (where they can squeeze a few more $ out of you).
