How do you determine an appropriate bid on a house you want to buy?

Question

They are asking $299,900 and it has been on the market for over 3 months.

Answer 1

This is where a Realtor comes in handy as they are knowledgeable about recent sales and market trends. In some markets houses are depreciating, but not so in others. 3 months isn't all that long for a house to be for sale. Assuming it is not over priced and in good condition I suggest offering 9% below list, but your local Realtor would be a better resource.

Answer 2

Several people above have said to pull comparables in the area, which is not a bad idea, but it is not always a fair assesment of what the specific home you are bidding on is worth. This is especially true in today's market where the average home has "Depreciated" at an average of 3% per year since 2006 and the average home is on the market for 9 months since 2006.

List prices can be inflated and often are. The seller may need a specific sales price to pay off their current loan so they boost the asking price to attempt to make a profit.

Since the home you are bidding on has been on the market for 3 months, it is likely they are asking too much for the home. If it was fairly priced, it would have sold in the first month even in today's market. In fact, one of my clients just purchased a home that was on the market for 3 months for 282k and the list price was 310k.

With the home being on the market for 3 months, I doubt they have had very many offers, if any, therefore I would bid low (90% of the list price or 269k) and see what they do. If they do not accept, I assure you they will more than likely counter offer to begin negiotations.

Answer 3

Three months on the market is not overly long. In my particular area, this is LESS than the average time on market.

If you want to buy NOW, you should expect to pay current market price or close to it. What it might be worth six months down the road is irrelevant to today's market price.

Ask your real estate agent for examples of comparable recent sales so that you have an idea of a fair offering price.

Answer 4

Housing prices these days are dropping, so you should definately be very picky about buying and offer way less than recent sales. Otherwise you'll regret it in 6 months when other houses are much cheaper.

Base your offer on comparable price per square foot. Since it's been on the market 3 months and the market is dropping, make your offer low. Maybe offer 220k and come up to 250k at most, but it depends on comparable houses.

Answer 5

ask your realtor to run comparisons in the area - this will give you a good idea of past selling prices for that neighborhood. it will also let you know if you are getting a good value.

Answer 6

Have your realtor pull comparables, also make sure you see if the property needs any work, also if it has an unpermitted rooms, ect. And then make you decision.

Answer 7

a good starting point is always know the note on the place