There exists a strong disconnect between buyers and sellers in the Cincinnati Real Estate market regarding the value of their homes. In no other industry is an item's value so arbitrary that licensed professionals will literally give you up to a 50% range in what they believe your home is worth.
When selling a home, a good real estate agent is necessary to help you see eye-to-eye with the other side.
When working with buyers, I've come across three different types. My favorite type of buyer are those that have relocated to Cincinnati from a larger city, especially one with a hot real estate market, they're more likely to rely on the seller's asking price as an indication of the real estate's value. They tend to bid at the asking price or very close. I come off as a hero by talking them into a lower bid, which most of the time works out. Their main priority is the home and view the Cincinnati home prices as "chump change." When they're able to get a nicer home for less than half the cost of their previous residence, cost isn't as much of an issue.
Another type of buyer is the one that will take advantage of their agent's knowledge and experience to assist in making decisions. I also enjoy these types of buyers. Sick patients rely on their doctors, criminals rely on their lawyers, so why shouldn't homebuyers rely on their Real Estate Agents? These buyers take your experience and advice when negotiating an offer. Their number 1 priority is the home, and their number 2 priority is getting it at the best possible price. I've negotiated hundreds of homes and understand the process better than the average Joe. Nearly all of these buyers end up happy. The important thing is to be sure that your agent is competent! There are a lot of bad agents out there, so make sure you use an experienced agent that was referred to you.
The third type of buyer is the one that determines the value of a property in their own mind without taking the market statistics into account. The buyer might do some research to validate comps in the area, but regardless of the outcome, expects to take 5-10% off of the list price through negotiations because they feel they're entitled to it. In their minds, if the seller wanted $100,000 for their house, they should have priced it at $109,900, not $100,000. Their top priority is winning the negotiation battle with the seller and getting what they feel is a "great deal." They put a lot of emphasis on the seller's list price and would rather settle in a home where the deal was good, than settle in a good home where the deal was not as good.
As a seller, it's important to quickly determine what type of buyer you're dealing with during negotiations. You can't afford to let any potential buyer slip away by taking only a single course of action.
If you come across the "Relocated Buyer," don't get greedy and think that since he offered $2,000 under list price that he'd be willing to pay full asking price. Make him happy and accept his offer. Goodwill at the start of the transaction will help during further areas of negotiation. It's also important that your home is priced accurately so that an appraisal or outside influence does not give him the impression that he's overpaid.
If you come across the "Relying on the Agent Buyer," then the negotiation period should hopefully play out like clockwork. Both agents will work together to determine an accurate value of the home and a fair agreement between both parties. Trust your Realtor to guide you through the process.
If you come across the "Independent Buyer" that believes he knows the value of homes better than anyone else in the world, you have your work cut out for you. Your agent will need to figure out how to convey an accurate value of the home to the buyer and determine how to structure the deal so that the buyer believes he won the negotiating period. You'll likely sell your home at your bottom dollar price, but at least it's sold - THANK GOODNESS FOR YOUR REALTOR!!!
