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Is this a fair offer?
Not that I'm doubting my realtor or anything but I want some of my fellow nesties opinions.
An investor purchased the house at $235K 3-4 months ago. He fixed the house up to be move in ready with the exception of a fenced back yard, it's a corner lot/property. The house is now on the market for $325K. NOTE: A few other houses with the same specs were sold between $275-$295K over the last 2-3 months and a house on the same street was lowered from $340K to $325K. The seller is willing to pay closing cost, approx $9600, depending upon how much he/she sells the house for. Yesterday we offered $290K and the seller to pay closing costs,we are willing to go up to $305K if we get a counter offer.
Have any of you nesties found yourselves in this predicament? We're really anxious but don't want to low ball the asking price. Afterall the seller would be sitting on a roughly $35-$45K profit! Please let me know what you think...Thank you in advance!!!
Re: Is this a fair offer?
Welcome to the nest
First, know that for investors, selling a house is business. You're unlikely to throw them into a snit.
Depending on the condition of the house when he bought it, he could have spent $20-$80k on improvements, maybe more, probably not less. Let's say he spent $50k for a round number.
235k purchase + 50k invested = 285k total investment
You offered him a net of 280k, less than he needs to break even. It's no big deal, just expect negotiations to go on for a while.
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Thinking of doing cosmetic updates to a dated home? These were our costs.
Thanks! I'm really happy to have something to post on this board.
I'm more than positive that he did not spend $80K. I would say definitely say between $25-$50K max!!! But thanks for showing the investment total, it makes a lot of sense when you look at it that way. I know for sure we'll be back and forth which is why we've set our max at $305K. The area is nice but not worth $325K. Thanks for your speedy response!
Then add in carrying costs and agent commission, the seller would net even less than the $280K based on the above.