The Real Deal Miami

Lowball offers not effective in all markets

By Jovana Rizzo | June 13, 2008 03:01PM

Miami buyers might think that Florida’s housing crisis can let them get away with low-balling their offers, but that’s not the case in every market.

Brian Carter, managing broker at Douglas Elliman Florida, said that in the luxury market, offers will be quickly rejected if they are more than 10 percent away from the asking price.

“The luxury condo market and luxury retail market have held up,” Carter said. “You wouldn’t want to lowball in that market, you run the risk of offending the seller. They can easily find someone else to buy it.”

The mid-Miami market is where buyers can find some deals, especially in homes facing short sales, when the equity falls below what the owner still owes on the mortgage.

“Though it might offend the seller’s offer, you can offer 30 to 40 percent off [the market price],” Carter said. “The owner will just be ecstatic about getting out of that property.”

In bank-owned foreclosure properties, Carter said the prices are already down considerably, so making an offer more than 10 percent below the price could be futile.

“The agents that work in all those different markets need to be coached differently to get deals done,” especially with uninformed buyers looking to take advantage of the down market and buy cheap property, he said. Knowledgeable brokers are needed to help decide on prices that are realistic for each specific market, he said.