If you’re a first-time home shopper searching for the perfect property, you’ve likely come across the phrase “motivated seller” in countless listings.
But what exactly does that mean?
Describing a seller as motivated is often used to communicate to the buyer that the seller wants to make a deal—and may accept a lower offer to do so. As a marketing tool, this simple phrase can attract a whole new crop of potential buyers looking at properties below a given asking price. But just because those words are included in a property description doesn’t mean they aren’t lip service.
How can you tell if a seller is actually motivated? These tips will help you sort out what a seller may mean when they use that phrase in a listing.
If a seller needs to get rid of their house quickly, you have a chance at a better deal.
1. Is the Listing Agent the One Who is “Motivated?”
Sellers don’t write their own property listings, and agents know how to draw in buyers. Therefore, the motivated party may actually be the listing agent, who wants to see the deal get done.
But given that you won’t have communication with the sellers themselves, how will you know if this is the case?
Your buyer’s agent will be the primary party in figuring out whether the seller or agent is the motivated party, but he or she will also be able to negotiate on your behalf, given that those words were in the listing. If you can present a viable offer through your agent, it is the listing agent who must convince the seller to make the deal happen.
2. What Does “Motivated” Mean?
Of course, you may also find that “motivated” varies from seller to seller. If someone has already purchased another house, they may be willing to make a deal to avoid having to carry two properties at once. Just because the seller is motivated doesn’t mean they are underwater, so the actual benefits you may receive will also vary.
Typically, you can expect negotiations when it comes to figuring out what motivated means to a given seller. If the property is nearing foreclosure, you have a fair amount of leverage to get a better price and a quicker deal. If the seller is not really motivated, he or she may throw out a concession or two, at which point you’ll decide if the deal is actually worth it.
3. How Do Price Reductions Factor In?
If you want to do some research to figure out just how motivated the seller is, check past activity on the listing. Is the price being reduced every 30 days? That is a good indication that the seller wants to get rid of the property. In October of 2017, the median time a home spent on the market was just 73 days, so timing is another indicator of how eager a seller may be.
Your buyer’s agent will be able to find information about past listings for the property.
4. What Shape is the Property In?
If there are problems with a property, of course, a seller would be motivated to get rid of it. While that means you can probably get a great deal, is it going to be worth it in the long run if the property gives you the same problems as the last owner? You should always get a home inspection on a property you are interested in, but particularly in the case of a motivated seller. Check out city planning reports to see if there are any surprises coming to the neighborhood that would turn your deal into a dud.
5. How is the Home Presented?
When you visit, check the property itself for indications of disrepair. If regular maintenance isn’t being performed and the house hasn’t been cleaned up for showings, that may be a sign that the seller actually does need to get rid of the home.
Clearly, the phrase motivated seller can mean just about anything, making it one to take cautiously when looking at homes. However, if you do your due diligence and have an agent on your side, you have a better chance of parsing through lip service and finding the right deal for your situation. Get prepared for taking the next step by answering a few questions here, and a home lending expert will contact you.