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Answers (12)
- Cheryl Talbot Real Estate, "Virginia Beach Homes"
- Contributions:674
First and foremost, know the market where you are looking to buy. Even though you are protected in the appraisal process, you don't want to find out late in the deal the value is not there. Secondly, if you don't have a Realtor, think about finding someone who you can trust and believe will work hard in your behalf. Being represented doesn't cost you anything and in the long run having someone in your corner could save you thousands of dollars. I have buyers who interviewed Realtors to find the right fit for them. You can do the same. Last but not least, get a good reliable lender who will work hard to get you the best the industry has to offer in home loans. It's a good first start I think! Good Luck!
- Gary May, "RealtorTampaBay"
- Contributions:56
Hello Nancy, there's a lot of great advice already given...be sure to take advantage of it. Be sure that you review the comparable neighborhood sales with your Realtor...that will be your guide. Best Wishes!
- Seth Captain, "CaptainSeth"
- Contributions:142
You can't go wrong following the advice other posters gave. And one more for the modern market:
Many foreclosures are pricing themselves below their market value, at least here in Chicago. And I'm now seeing some, but not all, owner occupied properties with very competitive prices.
It's on our collective instinct as humans to want a better price than what is offered. It's built into our survival. Even Aspen homeowners don't want to overpay for their 28 person hot tub.
This instinct will collide head on when you see an attractive price and you'll insist your agent continue to lower the price. Imagine your reaction if a scuzzy looking homeless man approached you but you also knew he could be your father (yeah, extreme, by why not....)
There is no science to this. It's a game that has no guaranteed outcome just ground rules that a quality agent will know.
But if you love the property, and it's priced accordingly with the market, and you will be upset if you lose it, there is nothing wrong with paying list price, in fact, it will probably give you the winning edge of the other bidders who can't fight ten thousand years of hard wiring.
Many foreclosures are pricing themselves below their market value, at least here in Chicago. And I'm now seeing some, but not all, owner occupied properties with very competitive prices.
It's on our collective instinct as humans to want a better price than what is offered. It's built into our survival. Even Aspen homeowners don't want to overpay for their 28 person hot tub.
This instinct will collide head on when you see an attractive price and you'll insist your agent continue to lower the price. Imagine your reaction if a scuzzy looking homeless man approached you but you also knew he could be your father (yeah, extreme, by why not....)
There is no science to this. It's a game that has no guaranteed outcome just ground rules that a quality agent will know.
But if you love the property, and it's priced accordingly with the market, and you will be upset if you lose it, there is nothing wrong with paying list price, in fact, it will probably give you the winning edge of the other bidders who can't fight ten thousand years of hard wiring.
- Mack McCoy
- Contributions:1117
Nancy, we can't tell you how to get the home and pay the absolute least amount for it.
My "tips" are that you know what houses are actually selling for in the area, so that you can intelligently evaluate the property.
I have heard more than enough stories of people who lost houses they really liked by either under-valuing it or by trying to get "too good" of a deal; of course, nobody wants to overpay for a house.
The problem with having a "rule of thumb" is that there is no value in getting 10% off of something overpriced by 50%, and paying 10% more for something that is 50% undervalued would still be a great deal.
So, figure out what the house is really worth, and take it from there.
All the best,
My "tips" are that you know what houses are actually selling for in the area, so that you can intelligently evaluate the property.
I have heard more than enough stories of people who lost houses they really liked by either under-valuing it or by trying to get "too good" of a deal; of course, nobody wants to overpay for a house.
The problem with having a "rule of thumb" is that there is no value in getting 10% off of something overpriced by 50%, and paying 10% more for something that is 50% undervalued would still be a great deal.
So, figure out what the house is really worth, and take it from there.
All the best,
- Ginger Lightburn, "Ginger Lightburn"
- Contributions:4
Hi! I think these are good pieces of advice.
The one comment I'd add is you have to be realistic and not emotional about it the entire offer (price, terms, timelines, etc). First-time homebuyers often tend to be either overly excited about the house and overpay/don't get favorable terms OR overly excited about the concept of a "buyer's market" so they offer way too low and loss the opportunity. Really dig in to the sold comps of the neighborhood and make the apples-to-apples comparison between those homes and the property you are offering on. Don't just assume because we are in a buyer's market you can just take 10-20% off "just because." If it's a smart listing agent and seller, they've accounted for their market situation in their asking price. If they aren't doing this, you're comps will support a lower offer than what they are asking and it's more realistic.
Best of luck!
The one comment I'd add is you have to be realistic and not emotional about it the entire offer (price, terms, timelines, etc). First-time homebuyers often tend to be either overly excited about the house and overpay/don't get favorable terms OR overly excited about the concept of a "buyer's market" so they offer way too low and loss the opportunity. Really dig in to the sold comps of the neighborhood and make the apples-to-apples comparison between those homes and the property you are offering on. Don't just assume because we are in a buyer's market you can just take 10-20% off "just because." If it's a smart listing agent and seller, they've accounted for their market situation in their asking price. If they aren't doing this, you're comps will support a lower offer than what they are asking and it's more realistic.
Best of luck!
- wetdawgs
- Contributions:26833
When you request sellers to pay closing costs, be aware that you are essentially reducing your offer. So, if your offer is 10% under asking price and you ask for 6% seller concessions, your true offer is 16% under asking price.
- grokster
- Contributions:27
For comps you can check out Recent Home Sales here on zillow.
However, I find it gives you such a wide range that it's almost not worthwhile. One 3 bed house could be a wreck while another could have all upgrades and mountain/ocean views.
Also, pay attention to the Price History when comparing. It will help you determine how the asking price may have come down over time until the house hit the "right" price point.
And finally, be careful not to get into a Blind Auction situation - where you are told there are multiple offers. You really have no way of confirming this, and you will likely end up in a psychological bidding war against yourself!
However, I find it gives you such a wide range that it's almost not worthwhile. One 3 bed house could be a wreck while another could have all upgrades and mountain/ocean views.
Also, pay attention to the Price History when comparing. It will help you determine how the asking price may have come down over time until the house hit the "right" price point.
And finally, be careful not to get into a Blind Auction situation - where you are told there are multiple offers. You really have no way of confirming this, and you will likely end up in a psychological bidding war against yourself!
- NancyVDownie
- Contributions:3
I am a first time home buyer - so this is all new for me. This is what I do know... the house I am interested in is updated but brought for 20% of the asking price about 6 months ago. I've been told that it isn't too far off to first offer 10% less than the asking price but to expect them to come back with a counter. I am also asking them to pay closing cost. With that said and what I think they may of paid for upgrades I still think they would double their profit with what I am offering. Also it has been on the market for 2 1/2 months and they have already lowered their asking price. Does this sound somewhere in the right ballpark? Thanks for you help.
- Elena Petrov, "kapyarets"
- Contributions:174
Hi! You have nice advices from other Zillow readers. I think it's important to remember that offer is not just a price. You need to know the market to understand what numbers you should offer to get the property. It's important. But! There are lots of diferent contigences and dates that can make you offer stronger or weaker. These contingences can protect you as well. Please work with experiences agent who has ABR certification.
- Forefront R.E.
- Contributions:255
Good Morning Andrea,
In addtion to the advice given before me, I would suggest knowing the importance of each property you offer on. If a given property is in very good shape and you really like it, you might make your best offer up front. There will probably be other buyers offering on the same home. If a given property is in disrepair or on the market for an extended time, you might think of offering less.
Pat Palmer-Broker
Visit Our Website Here
In addtion to the advice given before me, I would suggest knowing the importance of each property you offer on. If a given property is in very good shape and you really like it, you might make your best offer up front. There will probably be other buyers offering on the same home. If a given property is in disrepair or on the market for an extended time, you might think of offering less.
Pat Palmer-Broker
Visit Our Website Here
- Andrea Bedard, "DreaBedard"
- Contributions:3
Hi Nancy, you want to take a close look at the neighborhood and most recent sales activity and compare it to the property you are interested in - your agent will help you with that. How does the price compare in terms of conditions, upgrades, square footage etc.? The goal is to get a good understanding about what range the list price falls in: reasonable, too high or very competitive. The most recent comps will also give you an idea about average closing help paid in the subdivision ... Next, you want to find out if there are any other perks offered (a home warranty for example) and when the seller wants to settle. If he's hoping for a quick settlement, proposing a closing date that is 3 months out would not be a strong point in your offer. In the end, all the information will hopefully guide you in making an offer you are comfortable with!
- Jennifer Bonk, "jennbonk"
- Contributions:19
Hi Nancy, my suggestion is have a professional negotiate your offer for you. It costs you as the buyer absolutely nothing. The seller pays 100% of the realtors fees!
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