Buying A Home
iteachkids81
member
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How much to offer?
Hello fellow house-hunters and recent home buyers!
We think we have found our house!!!
We looked at it last week, went back last night and looked in more detail to see if anything stood out as a major repair or red flag-just a couple minor things to fix, so we are going to be putting in an offer.
The house has only been on the market for 6 weeks. It's in a desirable neighborhood, good school district, but with the market being fairly slow right now, we aren't sure how low to make our initial offer.
DH says he read somewhere your initial offer should be 85% of asking price? I just don't know if they would take us seriously if we offer that low to start with.
I should also say the house is vacant, it was originally listed at $249,900, but after 1 month they lowered it to $244,800. DH wants to offer $210,000.... I think it would be better to just offer somewhere in the $220's so they only have to counter offer once.... ?
Any advice? We're going to be meeting with our realtor later in the week to do the offer paperwork.
~Jenny~
Re: How much to offer?
I second talking with your realtor. They should be able to help you. Do check out the houses in the area that have sold lately that closely match the house.
What we ended up doing is pricing all the major fixes (like bring electrical up to code, foundation work) that need to be done and then took that off the asking price and that was our offer.
If your realtor and/or husband say "don't worry about low-balling them, this is a business transaction so emotions aren't involved and they won't get offended," DON'T LISTEN. Your situation is very similar to ours--home on the market just a few weeks, price recently dropped, good area, vacant, relatively slow market. Ours was listed at $185k (originally $195k). My H wanted to start our offer somewhere around $160 or $165, which I felt was unreasonable. Our realtor said $170 was reasonable and that it was just "opening the conversation," meaning he knew it would end up being higher but this would start the negotiations. I brought up them being offended by our low-ball and he said not to worry about it.
But that's exactly what happened. They were so offended they didn't even want to negotiate at first. So, don't give them your top dollar right out of the gate, but don't give them an unfairly low offer. I hate haggling and negotiations, but going back-and-forth and having multiple counter offers is part of the real estate game unfortunately. It's extremely stressful and it sucks.
We actually walked away at one point because they wouldn't really negotiate. The night we told them no deal, I cried and yelled "I want our house!" at my husband. (I'd done exactly what you aren't supposed to do and become emotionally invested in a home before it was ours. I can't help it.) 12 hours later, the sellers came back and said they'd accept our counter after all. If you're fairly sure you have the advantage and that they don't have other offers, don't be afraid to walk away and give them a couple of days. (Although that wasn't our intention--we legitimately thought we weren't going to get the house--it worked to our advantage in the end.)
Good luck! I hope you get it!
We're in the process of selling our house and had a couple come in asking for $10k off the listing price, plus wanted another $8k in closing costs. Like the above, we were completely offended and came real close to outright rejecting the offer. The only thing that ended up saving the couple buying the house was a smart ass comment I made to our realtor which turned into us sending that back as a counter offer.
I'm not saying offer full price, but you do need to figure out what a reasonable offer is and your realtor should be able to help you with that.
Just a word of advice. I don't know about other areas, but in this area tax assessments are usually a good bit lower than the actual sale prices of homes in our area. Sometimes as much as $20-30k different (at least in our price range). So not always a good marker.
TAV is under-valued here, too. I think that's fairly common. It's just a point of reference, keeping in mind the disparity between TAV and actual value.
Our realtor had us start at 90%. We put offers in on two homes last year (both were accepted but one we decided not to go forward with after inspection) and there was alot of back and forth each time. Several days.
We sold our condo in tandem and it was the same thing.
I don't get the being offended. With the sale of our condo, I got some lowball offers and always went back to them with something a little less than asking. I think that was a signal to them I wasn't going to budge as far as they wanted. There is no need for emotions with this; its just business.
TTC Countdown to 8/2015