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Answers (6)
- Nick Setting, "NickSetting"
- Contributions:484
It depends on multiple factors like financing, inspections, etc. If you're making a cash offer with no inspections you might be able to get as much as 9-10% off initial listing price. If you're financing it's likely you'll only be able to get maybe 6-8% off list, but start at about 10%. Most banks use standard programs that simply state brief terms and they have a matrix or procedure of sorts that limits how much they'll accept initially. As the property is listed longer and longer that matrix adjusts accordingly. Of course every bank varies. You also need to look at who your buying from. Is it Freddie Mac or some small locally owned bank? Smaller banks are more flexible in their procedures and more likely to negotiate. Also, if the listing has just returned from auction banks such as the FDIC are more likely to accept much more drastic cuts to unload.
- Bob Brandt, "BobBrandtRealtor"
- Contributions:1019
After doing a market analysis and sizing up the cost of the work you need to do, then I would suggest 80-95% of that value. Some go for more than list in my area. Each local market and property is different. It also depends on how badly you want it and how badly the bank wants to liquidate it,
- Investors Agent, "mspi"
- Contributions:23
I dont understand the question.
My answer is I always offer what I want to pay or can afford to pay.
It does not matter wheteher it is a reo or not.
REO's can be overpriced just like a normal listing.
Always work your nubers backwards to come up with your offer price.
I often like to look at homes before I know what the list price is so it wont influence my due dilliegence. Often when we know what they are asking we try to make the numbers work.
My answer is I always offer what I want to pay or can afford to pay.
It does not matter wheteher it is a reo or not.
REO's can be overpriced just like a normal listing.
Always work your nubers backwards to come up with your offer price.
I often like to look at homes before I know what the list price is so it wont influence my due dilliegence. Often when we know what they are asking we try to make the numbers work.
- Dean Bright, "Dean Bright"
- Contributions:123
Good input below. I would just add a key component other than days on the maret. How many other buyers are interested in the property? Have there been any offers? I am seeing many REO's sell above list price, bc it is such a deal and there are multiple offers. Best Regards.
Dean Bright
ReMax
Athens, GA
www.DeanBrightRealEstate.com
Dean Bright
ReMax
Athens, GA
www.DeanBrightRealEstate.com
- Katie Criswell, "Katie Criswell"
- Contributions:130
There are 2 big things that I feel give you the biggest advantage in getting an REO for substantially (> than 10%) less than the asking price. That is the condition of the property, and the days on the market. In my area, you can forget getting it for much less than asking price if it hasn't been listed for 30 days. Between 30 and 60 days are when a lot of banks seem to be willing to talk. After 60 days, I would probably advise a buyer to start with an offer of 80% or so if they were willing to pay that.
Katie
Katie
- Craig Fialkowski GRI ,CDPE, "craigfial"
- Contributions:571
Your offer should depend on the condition of the property, location, how long it's been on the market, and what other similar homes of sold for.
In many cases if the property just came on the market, and you know it's a great value, don't hesitate, make an offer close to list price. if it's been on the market a while, needs work, and you are a cash buyer, you can consider 10%-15% below list, but be prepared for a counter offer, and have some flexibility.
Banks and Agents rarely appreciate a buyer that says, this is my only offer, take it or leave it. 99% of the time, it's a low ball offer, and will not get a response.
Your agent should be your guide. Trying to deal with a REO listing agent, may be difficult. They rarely answer the phone, or respond to emails.
Hope this helps.
In many cases if the property just came on the market, and you know it's a great value, don't hesitate, make an offer close to list price. if it's been on the market a while, needs work, and you are a cash buyer, you can consider 10%-15% below list, but be prepared for a counter offer, and have some flexibility.
Banks and Agents rarely appreciate a buyer that says, this is my only offer, take it or leave it. 99% of the time, it's a low ball offer, and will not get a response.
Your agent should be your guide. Trying to deal with a REO listing agent, may be difficult. They rarely answer the phone, or respond to emails.
Hope this helps.
As a rule of thumb, how much should the buyer offer as an initial bid on an REO that's on the market
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