Buying A Home
jibberjabbers
member
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Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Purchasing an investment property. I offered asking price. Seller counters.....
Is this normal? I feel like walking out and this is a waste of time and money. I'm already pre-approved for a loan. I will be paying half of it with cash.
We did not do a walk-around, an appraisal or an inspection yet. The property is currently occupied by tenants. This is also my first time buying a house. I don't even own a house yet. lol
Is this the normal procedure? For a seller to counter for more than the asking price? I guess maybe there are multiple offers on the property? There is no commitment really. I can just offer a little more, and then just walk away if the property is not worth it.
Price of the property is $419k.
I offered $419k.
Seller's Agent will text my agent a counter offer first thing in the morning.
Doing some search of the property. Zipreality estimates the value of the property at 350k. This is a 3 unit property. So maybe they're missing something? But I will of course get a proper inspection and appraisal before anything goes through.
What would you guys do? Walk away and buy a house for myself instead? I'm in CA. I feel like I'm buying on the bubble right now. As prices are inflated.
But what do I know?
We did not do a walk-around, an appraisal or an inspection yet. The property is currently occupied by tenants. This is also my first time buying a house. I don't even own a house yet. lol
Is this the normal procedure? For a seller to counter for more than the asking price? I guess maybe there are multiple offers on the property? There is no commitment really. I can just offer a little more, and then just walk away if the property is not worth it.
Price of the property is $419k.
I offered $419k.
Seller's Agent will text my agent a counter offer first thing in the morning.
Doing some search of the property. Zipreality estimates the value of the property at 350k. This is a 3 unit property. So maybe they're missing something? But I will of course get a proper inspection and appraisal before anything goes through.
What would you guys do? Walk away and buy a house for myself instead? I'm in CA. I feel like I'm buying on the bubble right now. As prices are inflated.
But what do I know?
Re: Purchasing an investment property. I offered asking price. Seller counters.....
Thinking of walking at this point.
1) Sale price is to be $434,999
2) Seller will not provide rental or lease agreements
3) Listing agent related to seller
4) Interest rate not to exceed 5.25%
5) Buyer shall pay points not to exceed 1.5%
Actually, I was told it is an industry standard to not turn over rental agreements to the new buyer until closing due to privacy issues. When I bought my first home three years ago, I was only looking at multi-family properties because I wanted to live in part of the building and rent out the rest. I also asked for rental agreements ahead of time and was told by my agent this typically isn't done. I would definitely receive them at closing; however, the agreements do become null and void at the sale because one of the contract parties...ie the seller/landlord...no longer owns the property.
She strongly advised me to have the tenants for the side I would be renting sign a rental agreement with me shortly after the sale, though I could certainly use the terms of their previous rental agreement...such as rent amount...as a guideline if I wanted to.
At any rate, in a strong seller's market with multiple offers, it is not uncommon for houses to be sold above asking. I would view the deal on its merits and, if it is worth it great, if not...then walk. Just like any other house you feel is not worth the price. I've heard complaints that Zillow is often way off on their value amounts, but I never used them to research houses, so I can't say personally.
I also think it is super bizarre they are putting conditions that have to do with your loan, but maybe there is a method to that madness. Do you have an agent? If so, I would run some of this by him/her. They will be the most familiar with what is/isn't common practice in your area.
Both times we put an offer on a house, our realtor drew up the contract, and both times it had a section pertaining to the fact that we're applying for a loan, including the max value for the interest rate, and points. He put numbers, at random, because they were just a necessary part of the contract. They held absolutely no influence over our actual interest rate or points (the actual rates were lower than the max our realtor listed). It's not unusual, I think it's just part of the "you can accept my offer because I really can afford this house with this loan" statement.
The won't provide a lease agreement because 1) They are living in the main unit. And 2, the rental income from the current renters is very low since it's family members renting off them.
And yes, we walked.
They removed the listing and re-listed the property at $479k! haha It's been on the market for just a little over a month.
Seems like the first listing was just to test out the waters. They wasted everyone's time.
For example. If you had two competing offers. One has a "normal" interest rate and the other has a "high" interest rate (ie. someone with bad credit), the seller would possibly go with the one with the lower interest rate because there's less chance that the bank will say you don't qualify when they start processing your loan.