Profile picture for bschellin1

What do I offer for a price for a home

 the sale price is 250,000 the tax assessment is 236000 but properties are selling for less in this area
  • May 30 2011 - Waupun
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Answers (7)

I would suggest having your real estate professional run a competetive market analysis so you can make an educated offer based upon current market prices.  Keep in mind the assessor office price is only used to dtermine taxes and they are normally behind in what is actually happening in a neighborhood....best of luck
  • June 01 2011
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A tax assessment on a property has nothing to do with the current market value of a home. Ask your agent for the recent comparable sales in the area. In this market you'll also want to compare the price of the home you're interested in with other similar homes currently on the market.
  • June 01 2011
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Profile picture for ExpectFirstClass
bschellin1 - This is a great question and one I hear from new clients often...and it's funny how the tax assessment comes into play.  The same thing goes for listing presentations.  The tax assessor can be the biggest thorn in my side.  ;-)

There is great advice below.  You can look up some of the information yourself online if you're so inclined.  I'll share a few guidelines I go by with you:

1. The comparable property should be in the same town.
2. Compare apples to apples - look for the same number of beds and baths
3. Look for comparable homes +/- 10% of the subject home's square footage.  If this doesn't pull up enough homes, expand to 15% then 20% until you have a good sampling.
4. Focus your search on the last 3 months, and if there aren't enough homes, open to 6 months.
5. Don't dismiss acreage or location.
6. Look at the pictures to see the finishes within the home. 
7. When you have a list of homes, drive by them to see for yourself.

You really want to focus on SOLD comparables as they will tell you what homes are really selling for.  A common mistake is to focus on what homes are listed for.  A seller can list for whatever price he/she wants...doesn't mean that the home will sell at that price.

With all of that in mind, remember that an offer to purchase is about more than just the offer price.  How much are you putting down for consideration?  Do you have any contingencies and, if so, what are they?  How long is the contingency period?  When do you want to close?  What kind of financing do you have?  How much will you be putting down?

These are just a few of the things I go over with my clients when evaluating offers.  The point as a Buyer (not as an investor) is to make an offer that will receive a counter-offer or be accepted.  This is dependent upon your motivation.  For clients of mine just looking for a deal, how we structure the offer is different than how I guide my clients who really want the home for themselves as an owner-occupied property.

Best of luck through the process...and if you need a referral to a Realtor, feel free to contact me and I'll put you in touch with a phenomenal Realtor in your local area.
  • May 31 2011
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I agree with my colleagues. CMA's are more reliable than using a tax assessment for the basis of an offer. Supposing homes in your area are selling for $400,000 but your only assessed for $250,000. What offer would you want to be presented to you?
  • May 30 2011
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I agree with Brian and Sharon, find a good Realtor and then follow their advice.  The most common mistake I see both buyers and seller make is not listening to their Realtor.  I have been involved in thousands of transactions and witnessed several thousand more, no other mistake comes even close.
  • May 30 2011
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Thanks for your question "bschellin1".  You really should contact a local Realtor as they can pull recent comparable sales.  This is what will give you a guide of what is  a low ball, market or over market value.

If you need a referral, feel free to contact me.

Good luck, hope this helps!
  • May 30 2011
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Profile picture for Sharon Lewis
We don't normally base our purchase prices on the tax assessment. Are you dealing with a realtor? If so they should do a comparative market analysis for you showing what has sold in the last three months that is comparable to the home ou want to purchase, age, square footage, upgrades, location to the subject property.
  • May 30 2011
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