I have not posted on this site much in the past…maybe a couple times but my brother and business partner were talking about a negotiation tactic that we have used several times recently that seemed to work well. I’m sure others do it too and I know we got the idea from someone among this group. If a seller is asking 10K for a home we’ll come up with 2 to 3 offers, put them on paper or verbally give the offers to the seller. We may offer them $7K cash or $8K with $200 payments for the next “x” years. Every time we have done this, it has taken the negotiation ability away from the seller. To be honest, I don’t think they know how to counter that. So they just pick one, always in my exeperience, the cash price! Hope this helps.
Nicely Done. In my feeble recollection, the first time I saw this strategy was from Tony and Scott. When negotiating buying a Land-Home package, they would make three or maybe four offers simultaneously with different structures as you have said.
As an aside, I hope you are making money with those cash buys. Although it was only an example: I wouldn’t be likely to pay $7K cash if the seller was asking $10K unless it was still a screaming deal at that price. I love motivated sellers.
Hi, This is my first post on this site. I am just getting into Mobile Homes and was wondering if there is a standard percentage, like maybe 30 or 40% disount off the purchase price when a Buyer offers Cash? What I’ve been doing is getting a pure Option on a single family home and offering a 30% discount off the Market Value of the house.
Example; Market Value $100,000 -30% = $70,000
I then have a Buyers List and Assign the Option to the Buyer. That way Im out of the deal. I tack on my fee to the End-Buyer!
There is no standard anything when dealing with mobile homes! Market value varies from park to park. I work in a park where an early 90s 3/2 rehabbed with wb fireplace and laminate floors will bring $23K seller financed and about $12K cash IF YOU COULD FIND A CASH BUYER. There is a park next door which shares a few hundred feet of property line with park #1. The same home mentioned above would only bring $5500 seller financed and $2500-3000 cash IF YOU COULD FIND…
Your option method can, and has been, done with mobile homes. Most MoHo buyers with cash buy a home the first week or two they have that cash. Cash is king in this business. Out of 154 homes I’ve sold, only 29 (05.3%) were for cash and about half were cull-the-herd low-dollar dumping.
Steve, Because you are always spot on with your mathmatics. I have to bust you on the 5.3% math. The actual percentage of 29 out of 154 homes is 18.8%. The 5.3 is 154 divided by 29.
Oh dear, it wasn’t even late at night or after several beers. Just a plain old goof-up. Thanks, Don, for keeping us on our toes. You probably did the math in your head and saw it didn’t come out right in my post. Thanks for the correction.