Ok, let's get down to the nitty-gritty on making an offer on a home. This process can be quite different depending on how the local market looks at the time of the offer. In a seller's market there may be competition for any given home and competing offers can drive the price of a home up quickly. However, the national market has definitely shown signs of moving towards a buyer's market and that is a whole different ball of wax. In a buyer's market it is possible for the buyers to go a little overboard, or "underboard" as the case may be when making their offers. Just because it is a buyer's market does not mean that sellers are going to accept an offer that is less than the actual value of the home.
Low-ball offers are difficult things to deal with.
Usually they are received with scorn by the sellers who cannot believe that someone would make that low an offer. For instance, offering $75-100k less than the asking price is not likely to be well received by the seller. Chances are that if an offer that low is made then it will be under the appraised value of the home and the seller would be taking a loss in selling it. A buyer's market can mean some great deals on homes but it does not mean that sellers are willing to let their homes go for less than they are worth. There is one good way to avoid insulting sellers by low-balling their home. Ask your realtor what homes are being valued at in that neighborhood. Once you know this information you can tailor an offer that will be seen as valuable and fair.
The funny thing about low-ball offers is that every now and then, they are accepted. Either out of a desperate need to sell or perhaps relocation needs to be done quickly. If you can find these sellers then you may be able to get away with making a lower (yet not insulting) offer. Networking with your realtor is the best way to deal with these situations as they will be better equipped to gauge the seller's situation and how quickly they want/need to sell their home. Generally if someone is desperate to sell then your realtor should be able to recognize that and inform you of the situation. Just keep in mind that ever a desperate seller will bristle at getting a dismally low offer.
