How I Get Lower Offer Prices Accepted in 2025

21:14Brandon Turner:So as long as you're plumbing HVAC and your floors are covered and you fix anything, that's the major damage. So it probably costs you about 10 grand to get it in selling order. And then you could sell it for$320 ,000. It may take you three months to do that work, another two to three months on the market. So in six months, you could sell it for $320 ,000 with only a$10 ,000 investment. Or what I could do is I could come in and I can get you paid in seven days. Again, it's going to cost me about$50 ,000 to do that work. I am going to try to sell it for$400 ,000, but I got to pay an agent. That's 6%, right?

21:47Brandon Turner:So I subtract 6%. I'm doing this calculations right in front of them. Then I got to pay the mortgage while I have it, because yes, I buy with cash, but I do borrow that money from a private investor and they want their 12%. So that's about$15 ,000 in holding costs. Then I got to pay for the renovation. We said it's going to cost about$50 ,000. So we subtract$50 ,000 from that number. And then I've got to pay closing costs. And I'm going to pay your closing costs when I buy it, which is going to be about$10 ,000. And then I got to pay closing costs again when I sell it. So that's probably another$10 ,000, right?

22:19Brandon Turner:And so I have the sheet in front of them where I say, here's the 400 minus the 6 % minus the 15 minus the 50 minus the 10 minus the 10. And I said, obviously, I can't do this for free. I have to be able to make some money. So when you subtract my profit, I show them my profit. I tell them, look, for me to do a deal of this size, you know, I'm looking to make about X. I want to make typically the risk I have to put into it. I'm going to spend 50. I'd like to make at least 50. And so here's the number that I would offer. And it's just literally a calculation down the piece of paper that they can see.

22:50Brandon Turner:And then I show them the number. Honestly, this is working on me. Like the amount of math you just did, I'm like, I don't want to do all that stuff. Let Henry do it. It's very effective because you're explaining to them how complicated flipping a house is, right? Not in every detail, but they're not thinking about closing costs. I would imagine the average one's not thinking about closing costs, they're probably not even thinking about commissions to the selling agent. In their mind, they're thinking it's worth 400. I can put 50 grand into it. I'm going to make X. And then you show them like, actually, there's a lot more to this.

23:25And then people get to make their own decision about whether they're willing to take on that work or not. But you're being very transparent with them. I can imagine that working very well. Do you have an estimate? Like once you get to this stage of your negotiation process, how often do they take the offer?

23:43Brandon Turner:I would say I have to make about 10 to 15 offers before I get one accepted. And so it's a lot, like it's a volume game. And where does it break down usually at this point, like after you've like done this and they just don't like the number? Yeah. Typically if they don't say yes right away, it's they're truly trying to figure out, you know, is there another option? Right. And typically they're looking at that second option. Maybe I just list it and try to get X, right? And that's okay, because you will make more if you do that. It's just going to take a long time. And so, you know, it's typically they just need some time to think through those things.

24:18Brandon Turner:And if they're truly motivated, I will be the investor that typically gets the call back because every other investor made an offer in the same ballpark, but none of them explained how they got there. And so when it gets to a point where they're ready to say, okay, I'm just going to sell it and get what I can. I frequently will get a call back, even if my offer wasn't as high as another investor's offer, just because I took the time to build the rapport and the trust and be honest and transparent with them. And then how often do people come back? If they don't accept right away, do you get people who call you a couple of weeks, months later?

24:51Brandon Turner:All the time. So we put them in follow-up so that we're actually calling them every week or so, just checking to say, hey, did you get an offer? Did you sell it? My offer still stands. But a lot of the times they'll call back, back sometimes a year or so later once they've realized, okay, it's been a year. I haven't done anything. I might as well get rid of this thing and make some money. Do you ever budge on price or do you sort of like set your price and stick to it always? I'll budge on price. So there's a couple of us. And sometimes depending on how much it is, I'll show them what I want to make.

25:18Brandon Turner:Like there was one recently where it needed$120 ,000 renovation. And before I showed him how much I wanted to make, I told him, I was like, look, this house needs a lot of work, which means I'd be taking on a lot of risk, I'm going to want to make a lot of profit to take on that risk. So I may not be the best buyer for you. And there's probably other investors who are willing to make less to do this much work. And I set that tone on the front side so that they knew when I said, hey, this is what my offer is going to be. Yeah, it's because I'm budgeting to make a decent profit. And again, it's just honesty.

25:52Brandon Turner:Like if I know my number is going to be super low and another investor might be higher, I'm just going to tell you because it is going to be what it's going to be anyway. When I make that number, you're going to be pissed and then you'll go somewhere else. Whereas if I'm just honest with you and I show you everything, you know, maybe there'll be a shot for me down the road if you don't find another investor that you trust that's going to give you a higher number. Well, this has been a great conversation. I've learned a lot from you, Henry, already about negotiating off-market deals. I do want to turn to on-market deals because I think this is an emerging opportunity for real estate investors that we need to talk about.

26:27But we do need to take a quick break. Before we go to break, though, I just want to remind everyone, if you want to learn more about negotiating, the kind of stuff that Henry's been talking about here, one of our keynote speakers at PPCon this year is Chris Voss. He is the former lead crisis negotiator for the FBI. He's written a book called Never Split the Difference. I think I've literally read it four different times. I know Henry's a fan as well. And the skills that he teaches from his own career negotiating stuff way more high stakes than real estate, like literally with people's lives are lessons that you can truly apply to your own real estate investing career.

27:08I genuinely attribute probably hundreds of thousands, if not more dollars of my net worth to the stuff I've learned from his book. So if you want to learn from him and be at BPCon where he's a keynote, head to biggerpockets.com slash conference and you can get your tickets for BPCon. It is this October 5th through 7th at Caesars Palace in Las Vegas. It's going to be a lot of fun. Go check it out. We'll be right back. Most investors only think about insurance when something goes wrong. A tenant injury, storm damage, loss of rent. Then suddenly, the cheapest policy doesn't feel like the best one anymore.

27:44That's why a lot of BiggerPockets investors use steadily for landlord insurance designed specifically for rental properties. Whether you own one property or a growing portfolio, they make it simple to get covered properly. And BiggerPockets Pro members get an extra 5 % off their landlord insurance premiums. Visit biggerpockets.com slash landlord insurance to get a quote today. Do you ever notice how every passive investment somehow turns into a very active lifestyle? Active spreadsheets, active phone calls, active stress. Here's a better question. What if you could buy brand new construction homes, 10 % below market value, in the best markets across the country without making real estate your second job?

28:25That's exactly what Rent to Retirement does. They're a full-service, turnkey investment company handling everything for you. In some cases, investors get 50 to 75 % of their down payment back at closing, plus interest rates as low as 3.75%. They've partnered with BiggerPockets for over a decade, helping thousands invest smarter. If you want to do the same, visit BiggerPockets.com slash retirement to learn more.

28:49Brandon Turner:Quick note before we dive back in. This episode is brought to you by Cash App. I've been using Cash App for years to send and receive money and to online shop safely. More investors are thinking about where Bitcoin fits into a broader portfolio, not as a short-term trade, but as long-term exposure to an asset that behaves differently from traditional markets. Cash App makes that kind of Bitcoin strategy more straightforward. You can buy Bitcoin directly in the app, set up recurring purchases, or make larger buys when it makes sense for you. And with zero fees and zero spread on automatic purchases like auto-invest, roundups, and paid in Bitcoin, more of your money goes towards Bitcoin.

29:27Brandon Turner:Download Cash App today. Visit our link in bio. Bitcoin Services by Block, Inc. See the Bitcoin disclosures at cash.app slash legal slash podcast. A few weeks ago, I took a trip down to Pensacola, Florida with my dad and my kids. We spent our days at the beach in the pool. We cooked dinner together one night. And I got to experience the simple joy of just watching my dad suck up time with his grandkids. We played a round of mini golf that ended up being the best part of the whole trip. And it was one of those visits where you just slow down with the people you love and realize how much these ordinary days together actually mean.

29:58Brandon Turner:But while I was gone, my house was just sitting there empty. That got me thinking about something I hadn't really considered before. What if I could actually put that space to use while I'm away? That's what got my attention about Airbnb's co-host network. If you've ever thought about listing your space on Airbnb but felt overwhelmed, a co-host can help. They're experienced locals who can create your listing, manage your reservations, message guests, handle on-site support, and even take care of design and styling. It makes the whole thing feel realistic and not like a full-time job. Instead of your home sitting empty, you could be earning a little extra cash to put towards your next trip or whatever else you're saving for.

30:35Brandon Turner:Find a co-host at airbnb.com slash host. Buying real estate has a funny way of making the future feel very real. You start thinking about mortgages, cashflow, tenants, and suddenly you realize, if something happened to me, would the people I love be okay? That's why life insurance is one of those things that's easy to put off, but is super important to actually deal with. Ethos makes getting life insurance fast and easy, 100 % online. You can get a quote in seconds, apply in minutes, and potentially get same day coverage. There's no medical exam. You just answer a few simple health questions online.

31:12You can get up to$3 million in coverage, and some policies are as low as$30 a month. Ethos helps provide financial security and helps protect the people who depend on you. Take 10 minutes to get covered today with life insurance through Ethos. Get your free quote at ethos.com slash real estate. That's E-T-H-O-S dot com slash real estate. Application times may vary. Rates may vary.

31:41welcome back to the bigger pockets podcast i'm here with henry washington we're talking about negotiating in today's day and age henry just gave us a amazing overview of how to negotiation with off-market deals let's talk about on-market deals henry because this is an emerging opportunity in my mind you're probably thinking yeah it would be great to negotiate every deal but that's not realistic. There's actually this data that they track called the list to sale ratio, basically how much of list price people are paying on average. And for years, it's been at like 102, 103%. So people on average paying two or 3 % above what's normal.

32:20Now it's closer to 98, which means on average, people are paying 2 % less than list price. And what I'm going to ask Henry is, how do you do better than that average? How do you pay 5 % lower than list price? That's what I would be shooting for it as an investor right now. But let me just ask you, Henry, like, do you think that's reasonable? Oh, absolutely. In this market, 100%.

32:39Brandon Turner:So how do you even go about it? If you're a seller and you're making an offer on a property that's been on the market for a while, that's your first clue to let you know that you've got some wiggle room to make an offer at a price point lower than list price. So days on market is always going to be your first indicator. If you are making an offer on a property that just one on the market today and you really want that property, you probably should come in stronger because you don't have time on your side to show you that there isn't a lot of demand for this property. And so there's some emotion tied to it and there's some reality tied to it.

33:15Brandon Turner:But days on market is your first indicator for negotiation as a seller. Yeah, I think this is probably the single most important thing about judging on market deals right now is that put yourself in the seller's shoes, right? They need to feel a little bit of pain to come down off of their expectation because they just put the property on the market. Let's call it for$500 ,000. Their agent just told them that it's worth$500 ,000. That's why it's listed for$500 ,000. And so if you come in at 440 on the first day and their agent just told them it's worth$500 ,000, they're obviously not going to accept that.

33:49Now, if it's been on the market for 90 days, clearly the market has given them feedback that it's not worth$500 ,000. It's worth something less than that. Can you knock 10 % off of it? Probably not right away, but could you knock something off of it? Probably. And so I think to Henry's point, that's a really important thing. Same thing with stuff that had gone pending and come back on the market. Again, it's another example of sellers getting feedback from the market that this isn't going to be easy for them. And I think in my experience, right, the sellers then thinking like, how do I solve this problem?

34:23You know, like it's either sitting on the market or I can't get it to actually close. So I'm willing to play with the levers that I have in order to move this thing. And price is one of those levers. We can talk about the other ones.

34:36Brandon Turner:Yes. And there are ways for you to negotiate when a house first comes on the market and even get a lower price point. But again, you're going to have to shift one of the levers in their favor in order for you to get the lever of price closer to your favor. And so what you might negotiate depends on how long that property may have been on the market or not. Like if I want to get a deal for less than what it's listed for and it just came on the market, I can offer less, but I have to give the seller something else that might be enticing to them, like a large non-refundable deposit or a very fast close, right?

35:14Brandon Turner:Something that says, yeah, I'm going to give you 20 grand less than what you're asking, but you'll get all your money in seven to 14 days with a quick inspection. These things are worth something to sellers. Yeah, I just did that. I bought a property for list price because I walked in there and my agent said it's probably worth that. My agent said there's going to be a bidding war for this, right? Like this one, it's underpriced on the market and it's going to be, it's going to sell for a hundred grand. I was like, how do I get it for list price? which in my mind is a discount because it was undervalued on the market, which happens.

35:48And so I did exactly what you did. I put a large deposit down. I waived my appraisal contingency. They had a pre-inspection. So I just accepted the pre-inspection without anything else. And I said I would close in, I think, 21 days. And that gave them all of the assurances that they need. And they took my offer and didn't allow any more offers. It was great. That's exactly what I wanted. I was able to use non-price negotiation. I feel like they probably thought they won. They got full list price. And I felt like I won because I think that property was worth probably 5 % to 8 % more than I paid for it.

36:22Brandon Turner:Yep, absolutely. That is exactly the way you can do it with a newer listing. So I know you've talked a lot about being open and honest and transparent with your off-market deals. Do you take the same approach with an on-market deal? Because it's kind of different. Like you're just, it's so formal, right? Like you don't have a personal relationship. You don't really have trust. So like, how do you signal your intent, especially if you're making what is maybe a lowball kind of offer? So my agent already knows that I'm a credible buyer. I do what I say. And so he will typically set the stage with the other agent and say, hey, I've got a cash buyer.

37:00Brandon Turner:He's bought tons of properties all over Northwest Arkansas and kind of sells them on a credibility package for me. so that I'm not just some random person making a lowball offer. I'm making the offers that I think make the most sense. And maybe we can work out something with your seller. So he kind of sets the stage, builds some credibility for me because I can't do it myself to the other agent. Now, whether the agent relays that to the seller, we can't control, but we still do it with the other agent. And then we just make the offer. And that's what I tell people. It's so impersonal that it's more of a volume game with on-market deals.

37:35Brandon Turner:You just have to make your offer. and you can try to explain things to people so many times and some agents are going to hear it and some agents aren't going to hear it and some agents aren't going to care and some aren't going to care like you just have to shoot your shot when you're making on-market offers dude i am constantly surprised by what offers on market get accepted and rejected like the ones i'm like oh i just made such a strong offer they're like yeah no that's rejection then sometimes you throw in and you're like they're never going to take this and they're like it's yours okay it's just it's Super surprising.

38:07Brandon Turner:You have to shoot your shot. But I think that's where a lot of investors fail is they don't shoot their shot. They don't make the offer because they're so worried about offending someone or that it's so far below retail value or their personal agent talks them out of making the offer. That's what I was going to say. You got to find an agent who's willing to work with your strategy, especially if they're a new agent who came about in the last five years. They've probably never had leverage to negotiate before. They've been in a significant seller's market for five years plus, and they're not used to it.

38:40And so you need to find someone who knows how to do this and is willing to do that too. I think for me, the thing I've tried to convey in the last few years is like, I'm going to close. That's like the, you know, you talked about your credibility packet. Like the thing I want the seller to understand, which you can't say to them directly, which is annoying. but like through your offer, the thing I am trying to say is like, this guy is serious. He's bought real estate for a long time. He's not going to nickel and dime you on the inspection. He's not going to back out because his interest rate changed by an eighth of a point.

39:13He wants this deal at this price. And if you accept this offer, he is going to close on this deal because right now the number of contracts that are getting canceled is a lot. And this is a legitimate fear for sellers. And to me, I think most of them will probably take five grand off their price, 10 grand off their price to know like, hey, I'm signing one contract. This thing's going to be done and paid for. I'm going to have my money in three weeks and that's it. That is worth money to people.

39:39Brandon Turner:And if you can make that kind of offer, use that leverage. The other part of negotiation with these on-market deals, you've got to understand what you can do personally. What are your strengths, right? If you've got cash that you can put down and you're so confident, like if you've got experience and you're confident that you want and can close this deal, then you can put down a non-refundable deposit because that speaks volumes with non-refundable deposit because that says this guy's going to close. He's not just going to put up 10 grand and not close the deal, which is different than earnest money because you can get earnest money back.

40:12Brandon Turner:So if you've got cash and you're confident in a deal, then non-refundable deposit can speak volumes and help you get a lower price point. If you're concerned about your payment and you don't have a ton of cash, then you can maybe pay more or pay the asking price, but you can get them to buy down your rate with some of those dollars, right? So now your interest rate is lower, your monthly payment is lower. They still get a price that makes them feel like they're selling the house for a good amount of money and you're getting the house with a lower interest rate. You may not have got the price you wanted, but you got the payment you wanted.

40:42Highly recommend doing that if you're negotiating for new construction these days. Most of the times, if you're buying new construction, especially from a large builder, they're not going to want to give up their comps. They're building, let's just call it 100 properties in the same area. So if they lower the price for you, they're going to have to lower the price for everyone, right? But no one knows if they pay down your mortgage rate, you know, if they buy your points for three grand or five grand. And that is exactly what Henry's just saying. You can negotiate with them. And usually they have the team and the sophistication to know exactly how to do this, right?

41:16Like they have a whole backend system to pay down your mortgage or to buy down your points. And so for new construction, I would think you kind of have to do this right now. Like you can look, these are publicly traded companies. You can see that they're doing this all the time. And if you're not doing that on new construction, it's a huge mistake. Absolutely.

41:34Brandon Turner:These new construction sellers are trying to sell these homes and they need to sell them for the price point they underwrote them at. So they're willing to take 10 grand of your purchase price and buy down your points because it still looks like they sold the house for their asking price. They're keeping their comps. Yeah. All right. Well, this has been fascinating, Henry. I love this show. We should talk about negotiating more. This has been super helpful tips. We do have to go here soon in a minute, though. But any other last tips for our audience here on negotiating in 2025? First and foremost, like use your powers for good.

42:07Brandon Turner:We're negotiating, yes, because we're trying to make sure that we're not overpaying for something. But I found myself in a negotiation before with a seller who had no idea what they were doing. And I could have easily taken advantage of them. And so, A, we have to understand, use our powers for good. A real estate deal needs to be a win for everybody. If it is not a win for everybody, then you probably shouldn't do the deal. Even if it's a massive win for you, if you know they're taking a loss and feel like you're taking advantage of someone, then you probably are. you should probably back away from that.

42:37Brandon Turner:And the second thing is for you to be a good negotiator, you have to understand what your superpowers are, right? What you can bring to the table. Because if you know what you have, like if you've got cash, if you've got time, if you've got resources, lending connections, whatever it is that you can throw something into your negotiation that may benefit the seller, that doesn't affect the price, these are all things that you can use to help you get the price point that you want. So think a little bit outside the box, especially if you're dealing off market. On market, you only have a few levers you can pull.

43:06Brandon Turner:But off market, we've done things where I knew this person was going to have a hard time. There was a single elderly woman. And I said, hey, here's the offer we can make. I know I can't pay you as much as everybody else, but what I can do is I can hire movers and we can get those movers to come in and help you move. We can get you into a place safely and you won't have to deal with that, right? I knew that that was something of value to her because she was overwhelmed with thinking about, okay, I need to sell it, but I also need to get out of here. And so what can you offer that's easy to you that may not be easy for someone else?

43:36Brandon Turner:And these are things you can use to help you get price down. A hundred percent. This is one of the things I learned negotiating over the last 15 years, a lot from this book, never split the difference, but negotiating. I think a lot of people approach it with like bravado. They're like, I got to be tough. I got to go into this and be like, I got this number and I'm sticking to it. Whereas every success in negotiation I've ever had in my life comes from a high degree of emotional intelligence, understanding what the other person's problem is and put framing yourself as the person who can solve that solution best.

44:10That's how you win. You has to be mutually benefit. You can't see this as I win, they lose. It's how do we both win? And if you approach, in my experience, if you approach negotiating that way, you really can both win and you're going to get a lot more deals. Absolutely. All right. Well, Henry, thank you so much. I love this episode. This was a lot of fun. Thank you all so much for listening to this episode of the BiggerPockets podcast. If you want to talk with me and Henry about negotiating, you want to learn from the FBI negotiator, Chris Voss, don't forget to go to biggerpockets.com slash conference and get your ticket to BP Con today.

44:44Thanks again, man, for being here. Thank you for having me. See you all next time for another episode of the BiggerPockets podcast in just a couple of days. The right window treatments change everything. Your sleep, your privacy, the way every room looks and feels. At Blinds.com, we've spent 30 years making it surprisingly simple to get exactly what your home needs. We've covered over 25 million windows and have 50 ,000 five-star reviews to prove we deliver. Whether you DIY it or want a pro to handle everything from measure to install, we have you covered. Real design professionals. Free samples.

45:15Zero pressure. Right now, get up to 40 % off site-wide. Plus, get a free professional measure at Blinds.com. Rules and restrictions apply. I see you.

45:24Brandon Turner:Avatar Fire and Ash is now streaming on Disney+. It's the film critics are calling the best Avatar yet. Go, go, go, go! A true epic and completely jaw-dropping. This is the only purest thing in this world. Return to Pandora on Disney+. It will be an adventure for the whole family. And watch the Oscar-winning phenomenon at home. This is sick! Avatar Fire and Ash, now streaming on Disney+. Rated PG-13.