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Should I bid low when buying?

Should I bid low?  I'm interested in a house in Aurora, Co.  It's listed @ $189,900 but the zestimate is $124,200
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October 09 2011 - Aurora
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Answers (7)

Profile picture for user46620677
The answer really depends on the value of the property.  The Zillow estimates are not necessarily the value of the property.  Many factors go in to that figure.

I highly recommend contacting a REALTOR buyers agent to help you determine the value of the property before any offer.  Most agents will do it for zero cost.  They will be able to get you a good comparative market analysis of what the true value is.  In addition the agent will be able to show you other properties to help you compare.  They will also take in account the condition of the home, the current market situation.  Although there is data out there to help a non-Realtor find the value, it is usually incomplete and not the most updated like a REALTORS data.

Best of luck!
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March 26 2013
Great fundamental question.  Many factors come into play including how long it has been on the market, how well is it priced compared to other properties, how many alternate choices do you have if you don't get this home.

I always tell my buyers if they really like the home to offer the price at which they would be upset if someone else bought it instead of them.

Keep in mind that if you are getting a loan to buy the home, your bank will probably require an appraisal to help establish value and they won't lend your more than the home is worth on the open market.

Best of luck from Boise!
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October 09 2011
How does the "Asking Price" compare to recent nearby comps? What is your agent's professional opinion? Don't have one? Then I'd suggest you get one! Typically this possible purchase is one of the most important economics decisions in your life. Good luck!
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October 09 2011
The Zestimate is a better tool for looking at a general trend.  Are values in this neighborhood continuing to fall?
The Value Range is more accurate representation of the value.  The value will probably fall within it.
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October 09 2011
Your bidding strategy should be based on your needs and the properties value, ownership and use.

For example, lets say you are a FHA owner occupant first time home buyer.  The property is also owner occupied, and not in distress. Recent Sold Comparables show the property is worth $175,000 in it's current condition.  What would you be willing to offer?

What happens to the value when the owner is a bank, or the seller is in distress, facing foreclosure?  What happens to your financing if you have to change to a 203k loan for rehabbing?  What if you did not have to finance, you have liquid assets?

Zillow has almost no chance of being the correct value.
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October 09 2011

The zestimates are not always correct. The condition of the home, upgrades, etc. come into play.  Zillow does not have the information to take these into account..
Do you have a realtor?  They could do a CMA (Comparative Market Analysis) for you which would show what houses in the neighborhood have been selling for. Your bid for the house should be determined by that. 
If you really want the home, you need to make a realistic bid.  You have the right to pay a fair price for the house based on what it is worth and you can offer a lower price..
Conversely, the seller also has the right to obtain a  a fair price for his home.  It is my belief that negotiations should be based on a win win situation for everyone..

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October 09 2011
Profile picture for sunnyview
You should not be bidding based on the Zesitmate at all. You need to look at recent sales, current listings and the value trend for your area. An agent can help you or you can find closed sales on Zillow or at your local recorder's office.

A Zestimate is not a sale and a listing price is not the value of the house so you need more information to make a good offer.
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October 09 2011
 
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