Profile picture for bama006

How low is "too low" to go when low-balling an offer? Is there a % that's a good rule-of-thumb?

I'm not in a huge hurry to buy.  Wanting to spend no more than 350-375.  If a home has been on the market for several months is it unreasonable to ask for 20% less than the asking price?  I have my eye on a home that's listed at $435.  Is $350 an "unreasonable offer"?  What about 25%?  I guess all they can say is 'no' ... Your thoughts?  Not dealing with a realtor (yet).
  • December 07 2011 - Homewood
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Answers (7)

Hello Bama006,

simply put, you offer what ever you are willing to pay for the home.

Your REALTOR will do his or her due diligence and research the area for what houses in that area are currently listed and for what currently sold. 

Once that happens he or she will give you their professional opinion on what they think you should offer and help guide you through the process. 

Ultimately, once again, it is completely up to you as the buyer to offer what you can and or are willing to pay for the home.

Contact me at your convenience so that we may discuss further details or leave me your contact information and the best time to follow up with you and I will be in touch.

Regards,
  • December 09 2011
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Have you looked at the info on Zillow for your area? Here's a link to the recently sold homes. Here's the homes for sale.

Just from a brief look, 20% off of asking price doesn't seem an unreasonable start point. You might be able to infer from Zillow, that about 7% of Buyers in your area bought for 20% less than the Zestimate of value.

Your area has a four star Zestimate Tolerance Range. 50% of the recently sold homes, sold within 6.5% of their Zestimate. Only 14% of homes sold within the 20% over, or under, tolerance range. Not real helpful, but it's the best info you'll get from Zillow.

A great place to compare the comp sales is homesand.net. Hopefully, an Alabama REA will post something more helpful. Meanwhile, scour the sold homes data for insight.

ROLL DAMN TIDE! But, GO Gamecocks, too! See ya next year in Atlanta!
  • December 07 2011
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Hi Bama.

As a seasoned agent who primarily works with buyers I would absolutely advise you to start low.  "Rule of Thumb" does not take into account the simple facts that  (A) If a home is over priced to begin with percentages go out the window and (B) You can't go backwards in pricing negotiations.

However, I would like to strongly suggest you find an amazing agent who has a great handle on home values in the area, negotiation skills and good follow thru.  All offers I submit have comps to support our pricing along with the initial offer...now that doesn't mean there isn't room for negotiation, but it does mean that they are more likely to counter then reject. ;-)

Best of luck to you and please feel free to contact me if you have any questions, I'm in Tampa, but I'm happy to offer any advice or suggestions.

Regards,
Charlene Weston
Realtor
  • December 07 2011
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Profile picture for sunnyview
25% less in my market would be a bit steep and owners would probably never want to deal with me again. If I were you, I would try to get the % of listing price realized and the average days on market from an agent in your market. They should be able to pull both up off of the MLS and it is worth getting that info if you can before you make an offer.

You really need to look at the larger trend in your market. If you are flat, then 25% is too steep and I would offer closer to 10-15% off on a really stale listing at the max as long as condition issues warranted it. If houses in your area are moving in the mid and lower price ranges, then offering less on an upper tier property may be justified. It all has to do with the health of your market and your timetable to buy.
  • December 07 2011
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Profile picture for bama006
Good advice Pasadenan.  I'll keep it above a buck.  
  • December 07 2011
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Depends on the local market. In my market, sale price is generally 94-96% of list price. You can find these local statistics for most local markets published by local MLSs and local realtor associations. Best, Mike
  • December 07 2011
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Profile picture for Blue Nile
A good "rule of thumb" is "do not offer less than one dollar".

It likely wouldn't even be recorded as a transaction if you don't pay at least $1.

By the way, if you don't offer enough, they won't even bother to reply, let alone send a counter offer.

Perhaps go to Mexico and observe the bartering in the market place for a while.
  • December 07 2011
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