Three Reasons You Should Avoid Unsolicited Real Estate Offers
If you own a home these days, you are lucky in many ways. If you bought stocks before the recent rise in interest rates, you’re probably sitting on a nice, low rate that’s the envy of current buyers. And with homes available for purchase in short supply (the US housing shortage is estimated to remain at 1-2 million for the foreseeable future), your property is worth more and more every day.
This explains a common experience among homeowners: an unsolicited call, text message, or letter offering to buy your home even though it’s not on the market. Many homeowners are surprised when they start showing up because they assume that you need to officially list your home to sell it, but of course you can sell your home any time, to anyone, and at any price (well, your lender may have something to say about the price, but as long as you can pay off your mortgage, you can do whatever you want).
If you have no plans to sell your home, but the convenience of a buyer just walking in and handing you a bag of cash for that home is appealing, however, you might want to think twice: There are three main reasons why you should never respond to unsolicited inquiries. offer for your home.
Fraud
The number one reason to ignore unsolicited real estate offers is that they may be scams. Almost every time someone approaches you with an offer that seems too easy or too good to be true, it is. Here are a few ways scammers use these types of cold calls:
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advance payments. They’ll tell you they have a good cash offer for your house, but you’ll have to pay some administrative fees to get the ball rolling. No legitimate real estate professional will ask you to pay upfront.
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Bank details. Some scammers want your bank details , which they say they need for a bank transfer. Instead, of course, they use this information to drain your accounts.
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Title. Sometimes scammers will lure you in with a “cash offer,” which turns out to be an offer to sell your home on your behalf, and then ask you to transfer the title to them to make the process easier. Then they legally own your home and can do whatever they want with it.
It’s always difficult to determine whether an unwanted call is a scam, so your best bet is to simply ignore it.
Lowball offers
Most unsolicited real estate offers aren’t outright scams, but that doesn’t mean they’re a good idea. One of the main reasons is simple: an unsolicited offer will typically be a low offer that won’t get you the best return on your property. This is because these suggestions come from three main groups of people:
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Wholesalers. Wholesalers enter into real estate purchase agreements and then sell the home to a third party. Sometimes they already have a buyer for your home, sometimes they just think finding one will be easy. They are going to lower the selling price anyway because they need to make a profit. If your home can sell for $250,000 on the market, they will offer you $200,000 and hope to make a profit of $50,000. They hope that the convenience of receiving an unsolicited offer will entice you to make an “easy” sale.
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Flippers. You’re probably familiar with the concept of flipping a home, where investors buy run-down properties on the cheap, fix them up quickly, and sell them before they get too deep into mortgage payments. You might assume that Flippers are always targeting foreclosures, but they also make cold calls if your area is desirable, and it is in the nature of their business to underbid you to maximize their profits.
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Individual buyers. Sometimes this unsolicited offer comes from someone who legally wants to buy your home for themselves. Homes are expensive these days—the average home price is about $413,000 —so some people try to beat the market by making unsolicited lowball offers in the hope that the current owner will just jump on it instead of doing their due diligence.
Even if the buyer isn’t trying to scam you—and even if they make a fair offer on the property—you could still lose because an unsolicited offer prevents any bidding wars that could drive up the price of your home and increase your profits. on sale. If an unsolicited offer makes you decide to sell your home, you’ll likely make more money if you list it.
Sketchy agents
The third reason to ignore all unsolicited real estate calls is that answering one of them forces you to work with someone you know nothing about. They may not be licensed real estate professionals at all and may recommend that you not use a real estate professional to avoid their fees or force you to work with their team to close the deal. In other words, they appeal to your greed.
Bypassing a real estate agent may save you some money, but it also leaves you without their expert guidance and knowledge of both the market and the law, and leaves you relying on some random person who called you out of the blue for your information. If the unexpected offer is attractive, you should seek professional advice and research the organization making the offer to see if they are on the rise or not.
If an unwanted call about selling your home makes you think it’s the right move, you’ll almost always do better by going through the normal process of selling your home. An unsolicited offer indicates that your home is valuable, so you’ll likely get a better offer on the open market, and working with a legitimate real estate agent who understands your market will also likely maximize your profit, even taking into account Commission. Like everything in life, the easy way is rarely the best.