Looking for a home is exhausting, especially in a market like this one. We’ve been hunting since January and only recently made it to the offer stage. I found the process insanely stressful, to the point where I lost sleep, obsessively clicked reload on my email, and hemmed and hawed for days.

The Stress of Deciding Whether to Make an Offer
There have been a couple of homes where we considered making an offer. The first was gorgeous, but oddly arranged. It was also a steal. We seriously considered making an offer for a few hours, but one night of cooking in my own kitchen was enough to tell me that their kitchen layout just wouldn’t work.

The next offer we considered was a major fixer. On that one, we hemmed and hawed for days on making the offer. I started to view it as an investment rather than a place I had to live. Ultimately I decided that I shouldn’t make an offer because I’d been undecided for three days.

When we finally went to offer, we knew right away that we wanted to do it. We slept on it overnight, but we were ready to make an offer and had a price in mind within six hours of seeing the house.

The Stress of Waiting for the Counter
It’s rare for an offer to be accepted out of the gate. Everyone wants to see if they can get the best price, so there’s negotiating. However, waiting for the counter to come back can be agonizing. Will they reject the offer? Will they send a ridiculous counter? Will they accept? How motivated are they to sell?

I found myself trying to “time” the response and mark out when different offers would go out and come in. I tried to guess the counter/re-counter prices and at what point one of us would be willing to accept.

I again lost sleep and felt sick to my stomach. Once again, I had to remind myself not to get carried away. This is a buyer’s market. There will be other homes on the market (just as soon as the banks get around to listing them.) I have time to buy. If rates go up slightly, prices will come down because we haven’t hit bottom yet. We will find something we like just as much.

The first night we went to offer I started dreaming about paint colors and the house hunt finally being over. Within a few days, I started to doubt how much I really wanted the house. I looked at photos to remind myself what I loved. However, I was mentally preparing myself to walk away if the deal couldn’t be made.

The Stress of the Re-Counter
If the seller comes in with a high counter, there’s no reason you can’t re-counter. There’s no limit on the number of counters. An agent friend of mine had an offer go back and forth 8 times as they worked out the details. 8 times is rare, but it’s a great illustration that there’s no “right” number of offers and counters.

Still, re-countering is stressful. How much should you offer? How much will the seller come down? Will the seller refuse to come down?

When re-countering, you need to know your top number. Personally, I wouldn’t re-counter at that number the first time out, but don’t get so swept up that you go past that number.

I’ve read that some buyers feel obligated to accept an offer at some point because they’ve put so much effort into offering and countering. They don’t want to feel like they’ve wasted their time. Don’t let yourself give in just because you’re tired. This is a negotiation and you have to be strong enough to walk away if the numbers don’t work. There are always more houses.

Combatting the Stress
It’s hard, but here are a few ways to combat the stress of the offer process:

Get your mind off of it. I know it’s hard, but watch TV, see a movie, read a book, let work distract you. Unless you’re dealing with a builder or a bank, most sellers can only deal with offers in the evenings, so you’re unlikely to get an answer in the middle of the day. If you’re dealing with a bank or a builder, don’t wait for the phone to ring at 9 PM. Go about your business.

Think of reasons to walk. That will make you feel like you have more power if you can create a list of reasons why the deal won’t work for you.

Keep looking. If the seller is dragging their feet, there’s no reason you can’t keep checking the listings. Consider going to a few open houses if things really drag out. You may just find something you like better.

Remember, that even in a seller’s market, the buyer has more power. The seller has to get someone to make an offer, but the buyer is the one with more power unless you absolutely must move by a certain date. If that’s not the case, the most a seller can do is say no. Then you keep looking. If you can’t make a deal work, then it’s not meant to be your house anyway.

A home in an emotional investment, but it’s also a business transaction. Don’t get so caught up that you forget that. Yes, you need to love the house, but don’t love it so much that you can’t give it up if the terms don’t work. That’s the most important thing you can do to reduce your stress.

Comments

One Response to “Keeping Your Head During the Real Estate Offer Process”

  1. Carnival of Personal Finance: Birthdays Edition | Weakonomi¢s on May 4th, 2009 4:24 am

    [...] Aryn from Sound Money Matters presents Keeping Your Head During the Real Estate Offer Process. [...]

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