RE professionals/experience...fair price for city lot?

Question

There is a 130 x 50 foot lot in city of 90,000 population located near downtown, in older subdivision areas of homes built anywhere from the 1940's to modern. I went to the tax appraisal site for the county and found that it's taxed value is $20k, and market value is the same, because a home was removed from the site. The seller purchased the lot in January 2006 and is now selling it at 79k. I believe that the seller may have purchased the lot to include the home, which had a market value BEFORE just being taxed for the lot at $35k.

Question:
What would be a fair price to offer the Seller? There are two other lots, outside the city, that are acre sized at $75k each. The costs of properties have been escallating for the last 3 yrs, and I will be - again - out of the market if the price I have to pay is over $40k...if I'm to be able to get a home. I have to build a home bc my hubby needs a disabled-friendly home for wheelchair use. This has become mandatory-to build. No choice.

When a house is designed well, a 1000 sq ft home can be just as efficient and feel as large as a larger sq footage home...we will happily settle for a 1000 sq ft home, as many floorplans exist that are truly open in design & flow.
The lot is 50 foot deep and the wideness is the 130 feet, which is very workable. Trees surround the property, so can be very easily built around & landscaped well.
Retro fitting a fit for a wheelchair entails a great amount of cost and has to be worked around support beams/walls. It sounds much easier than can be done. Hallways s/b minimum 5' wide (how many homes can you open up hallways?), need a 6x6 area around a toilet free & clear, roll in showers are wider than bathtub area. Getting into bathrooms? little over 2 feet wide is ALL, because no need to move couches & dressers into the bath area, right? So ALL entries into bath areas are critically narrow. Wall in closets aren't as good as vertical designed. Height of sinks, area underneath..on&on,

WALK in closets...sorry..are harder to get inside & move around...

Answer 1

Contact a resiedntial real estate appraiser in your city. For a couple hundred dollars, he can tell you what the property is worth. That is what you offer. If you plan to get a loan, your lender will have you do this and pay for it anyway as part of the loan.

Answer 2

Easy:

1. Establish the "market value" of the property.

Hire an appraiser or ask local real estate agents for a report of recent "comparable sales." Compare this lot to other lots that are for sale to get a feel for the market.

2. Decide what the lot is worth to YOU.

The asking price and county records are nice to know, but the real question is: How badly do you want this particular lot compared to others that are available? How often do lots that meet your criteria come on the market?

Say, for example, that you really like this lot and the estimated market value is $35k but you can find other acceptable lots for $30k, then maybe this one is worth $32k to you. On the other hand, if lots like this rarely come on the market, it might be work $40k to you. Only you can decide what it is worth to you.

3. Decide an offer price and negotiation strategy.

Consider using a buyer's agent to help you with this. A good agent will determine the seller's motivation. It is completely IRRELEVANT how much the seller paid for the property or when they bought it!

Of course, no one wants to lose money on a sale, but owners sell at a loss if they have to (ever heard of a short sale? foreclosure?). Maybe the seller is in a financial bind and needs cash right away. Maybe the seller inherited the property, wants the cash and doesn't care about losing a few dollars. Don't assume that "they bought it only 1.5 years ago so therefore they won't take less and they won't sell at a loss." Advice like that comes only from an amateur negotiator. Your offer price can be as low as you feel comfortable offering.

4. Make your offer, including a contingency that the offer is subject to approval from the government to build the type of home you want.

By making your offer contingent upon city/county Planning Department approval, you can back out and get your money back if it doesn't get approved.

5. When your offer is accepted, hire an architect to create the design and submit it to the government for approval.

Buy a hammer and a box of nails because you are going to building a new home very soon!!!

Answer 3

A 50' dimension in either direction is very small for a lot. If it's only 50' wide, you're going to have a relatively narrow and deep home, depending on what the city allows for a lot line setback in this area. I'd pass on this one for something a bit more spacious.

You might as well consider an existing home with retrofit to wheelchair friendliness. Depending on how the home is laid out, sometimes it's not at all expensive to retrofit, and may well be less expensive than starting from zero.

You can't really compare the acre sized lots to this inner city lot for market values. They are apples and oranges. I suspect that, if the seller is asking $79,000 for the lot, he's done some research and isn't grossly overpriced in that. If you offer him half the price of it, he's going to laugh at you.

Answer 4

Regardless of whether there was a house there or not, a Seller who has owned the property for 1 1/2 years is not going to sell it to you at a loss.

The houses outside of the area will not be comparable to this lot in terms of amenities and location.

If you intend to build a house on it, first find out the largest size that the city will allow in that location, including the distance that it must be 'set back' from the sidewalks and road.

If that leaves you with a smaller house than you'd like, then you may not want to purchase.