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Thoughts on an initial offer
DH and I went to see a home for the second time today and we are thinking of putting an offer on the place.
It's been on the market for about a month and was quickly reduced down by $20k. Now it's listed at $575k but given recent comps and our realtor's opinion, we expect it to go somewhere in the range of $525-550k. We've agreed that $530k is our max for this home (I'd go higher but DH would not) but we're not sure where to start.
On one hand, we could come in around $515k (still less than 10% off of asking) and see what their response is. If they come back at $550k or so, we could work our way up. If they don't budge, we walk.
On the other hand, we could offer $530k firm and walk if they don't take it.
There were a few other viewings this week. Given that, my concern with going in at $515k is that if someone else offers $530k and the sellers take it, I'll kick myself for going in too low. But then again, if we were to offer $530k and there's no one else making that $515k offer to make the $530k look good, there's no guarantee they'd take it. Should we just give it our best shot and let them decide?
Any thoughts?
Re: Thoughts on an initial offer
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We just had this debate about a house we saw today. Listed for $459K (on market less than a month and already dropped $10K). We don't want to go over $450K. I think we should go in at $445K with 3% towards closing. I honestly think that sellers will counter ANYTHING that they get, so I would definitely start below where you want to end up.
Another tactic is just making the offer and saying it's best and final. If they've already dropped the price after a month, chances are they're eager to sell.
Go low. Your #'s are very similar to the #'s (% wise) that we dealt with when buying our present house. On the market for $425, $400 was our max. It had only been on the market 2 weeks and had dropped once by $20 or $25k. We started at $380 and ended right at $400.
People expect SOME negotiation. I think if you go in at your best offer, they aren't going to be interested or take you seriously.
~Benjamin Franklin
DS dx with celiac disease 5/28/10
Thanks for the advice! We got burned a few months ago when we bid on a home where the sellers weren't motivated in the slightest - they actually took the home off the market within about a week of our offer and haven't shown back up. So we're probably more nervous than we should be about potentially offending the sellers or coming in too low to start negotiations.
After much discussion, DH admitted he'd be willing to go up to $540k if it meant getting the house vs. walking away. We'll be putting in our $515k offer tomorrow afternoon and I'm feeling cautiously optimistic.