Profile picture for user8754504

Need your opinion on home offer...

Seeking your advise. Your thoughts and opinion. We visited an estate sale this weekend and found out the home was for sale. There was a flier at checkout with an asking price of $150k. We advised our agent and signed a contract with $2k down. We also included a pre-approval which is for a much higher amount. At this time, we are in the process of selling our current home with closing of August 15. The buyers of our home had an inspection done and will have it appraised next week. Back to our offer. Our agent was notified by sellers agent this morning and was told the new selling price is now $160k. My agent was told that this home was not on the market yet and the seller increased the price. Is it legal to advertise a price then change it? Even if it was not on the market and have an MLS number? Throughout the day I verbally agreed to the new price and increase the down to $4k total. With the sale of our current home we will have enough for 20% down and cover closing. I ran this past my lender and he said it was not legal to do. And to stick with the advertised price. If $160k was their set price then I'm to ask seller to cover 4% of my closing. The seller can reject our offer and put it on the market. Get an MLS number and put it on the internet and local paper. The home is in good shape. A little dated inside but with little it can look good. Paint, remove carpet, other minor stuff. Outside is immaculate, big yard very well maintained. The location is perfect, schools are great and the area is very sought after. We've been looking for month and hardly find anything. When a home hits the market/gets advertised in this area they go very fast. People almost always offer more than asking price. If we pass up on this home, it may be a while until we find another one or get lucky at another estate sale. In this situation, what would you do? Any suggestions or recommendation? Thanks in advance, Joe
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July 15 2013 - Tallahassee
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Answers (5)

Profile picture for user5154660
I would go ahead and submit the offer at the $150 price if you feel that is the price point this home should sale for. Has your realtor run the comps so you can determine what other similar homes have sold for.  From this you can arrive at what the buyers paid on a square foot basis.  Compare this figure to the home you want to purchase. You now should have a good idea of the home's value.  I believe you should use this value to determine what your offer should be regardless of his asking price.  I am sure the seller's agent used the same procedure to arrive at a suggestive asking price. Normally you would submit your offer below the price you are actually willing to pay.   The seller expects that he will be making a counteroffer and you should too.  Don't come in so low on your first offer that the seller believes it is insulting.  That will usually ends all reasonable offers.

Your realtor should emphasize your pre-approved loan status and the pending sale of your home.  I would make your offer contingent on the  sale of your home. I still think you should indicate, if requested by the seller, your ability to close quickly based on your current buyer's contract. I believe you indicated that you do have a closing date? As long as you make your offer contingent on the sale of your home, your escrow money should be safe .  I also suggest that you put a time and date they will need to respond by. Hope this is of some help. 
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July 16 2013
Profile picture for user8754504
Thanks for you input. At this time we go have a closing date on our current home but the buyer has not yet secured a loan. We are waiting for the banks appraiser next week. In the meantime, will adding another $2k to make it $4k make a difference on this new contract worth it? Our realtor said it shows we are serious. I was explaining 20% is coming from the sale of my home. To me it seems the sellers agent is looking to keep the money in case the sale of my current home does not happen for some reason. We only have 15 days once both parties sign the contract to back out. After that time, I would loose the money. Do you think I should wait until my current home buyer has everything 100% before making deals on my new home? Thanks again.
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July 16 2013
Profile picture for wetdawgs
You've told us all the reasons justifying  $160k as a reasonable asking price and "people almost always offer more than asking price".  

They can change their price up or down as many times as they want.  

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July 15 2013
Profile picture for user5154660
I would submit the offer again at the original asking price and would have your realtor emphasize that you have been pre-approved and are in the final phases of selling your current home.  Has your buyer secured his loan?  Have you set a closing date?  If you are in a position to, I would also indicate you could close quickly.  This should all appeal to the seller as am sure they would like to sell the home without additional paperwork with a secure buyer. It should be worth the $10k to them not having to worry how many days it will have to be on the market before they find a buyer and then if they will even qualify for a loan.  It should be a buyers market?
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July 15 2013
Is it legal to advertise a price then change it?

Yes, it's perfectly legal - even when the home is listed on MLS. The price is an 'offer' to sell and the price can deviate up or down, depending on the contract.


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July 15 2013
 
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