I am about to put an offer in on a home thats fair market value is 171,000 according to the court house. The owner just bought it in April of 06 and paid 195,000 and is listing it for 209,000. They are already out of the home but due to the fact that it is such a small town the market problems are not going on here. The average time on the market in this town is 12-14 months and it has been on the market for over 3. What would you offer? Also my agent just told me today that he is about to relist the property.
2007-10-22 19:03:37 · 6 answers · asked by hi 3 in Business & Finance ➔ Renting & Real Estate
dang... i already know what I want to offer but was just asking some opinions! If you don't like the question just don't answer.
The owner knows that they are going to take a hit. They are widowed and looking to get married again so decided to move in with the other person now.
2007-10-22 20:12:30 · update #1
The value at the courthouse is a taxable value, not a market value. In many areas, these valuations are not updated as regularly as you might expect and the valuation could be years old.
The only way to get a true value is to have an appraisal done on it. This is usually a part of the mortgage application process, but by then it is usually a little late to help you judge how much you should offer.
That said, the $171,000 figure should be erased from your mind as a consideration. More important is what the property is listed at and whether or not your agent feels that the price is supported by comparables in the area.
At 209,000 the owner is probably paying a 6% commission to their real estate agent. This is $12,450 if they actually get an offer at $209,000. This means the seller nets something close to $196,550 (minus more fees and closing costs) which is pretty darn close to the $195,000 they paid. It seems to me they have priced it so that they can walk away and not pay anything to do so. Your real estate agent can tell you if their asking price is fair.
What a previous owner purchased for and what they owe is really of no consequence to you. You are free to offer what you want to offer, just be aware that the seller is in a pinch and most likely won't negotiate below these figures. If I were the seller and I had an offer in 3 months and the average time on market was over a year I would figure my carrying costs into the equation and be able to take a little less for getting rid of the darn thing!
Also your real estate agent can tell you what % of the listing price the average home sells for in your area. If the average home sells for ~98% of list, I would come in near 96% of list to have a little negotiation room. All of this assumes that the original $209,000 is supported by the local market and the comps (comparables) that your real estate agent can get.
Based on all of that, the offer should be close to $200,000 if not exactly $200,000. This would show you are serious, you respect the seller and their agent and are willing to do some negotiating.
Good luck!
2007-10-23 03:44:28 · answer #1 · answered by Rush is a band 7 · 1⤊ 0⤋
I dont think you get it.
My opinion.
In most states they put a value of 85% of what they think its worth. Why? So they dont have lawsuits. Now depending on your state they might only look at the house. Not the lot.
For example. You buy a 200,000 home. They give you insurance for 180,000. You say I paid 200,000 why is my home owners insurance 180K? The insurance agent says the lot has to be worth something.
The questions you state dont make a ton of sense. If a person bought a property in 4/06 for 195K. And they are selling it now for 209K. The only difference is they are on an adjustable. The rate went bad. They arent making a dime if they have an agent. They took the other 6K.
Honest answer. If the agent showed you this property. They get the commission. If they didnt, let the owner know if it lapses you will pay 200K for the property.
As I said if the agent did anything you pay 205K for the property. If they didnt offer 200K and let it expire.
2007-10-23 02:49:02 · answer #2 · answered by financing_loans 6 · 0⤊ 0⤋
At the very least, you should offer him a little closer to what he paid for it, while also taking into consideration the additional fees the homeowner has to pay to both agents. Why would he want to lose money and reduce it to $171k from his purchase price of $195k? His other option is to rent the house until the market values increase. Although $171k may be a fair market value, it isn't for this home, unless the seller is desperate and wants to take a loss. Offer him $195k, maybe he is willing to take a slight loss, not a huge one. If he comes back with a counter offer under $200k, take it. You just got it reduced from $209k and the owner may still lose some money because they have to pay the agent's commissions.
2007-10-23 02:21:01 · answer #3 · answered by Susan N 5 · 1⤊ 0⤋
Because it is a buyers market you have the power. I would make as many offers low offers as possilbe. Sooner or later you will find yourself a bargan. We can help you get prequalified for a loan so that when you do make an offer you will know exactly how much your payments will be.
2007-10-23 05:00:04 · answer #4 · answered by Anonymous · 0⤊ 1⤋
Duh, if you have an agent ASK HIM! Why are you bothering with this site if you are working with an agent? That's rhetorical. Also, check out the first answer to see why it's best to rely on your agent and not the idiots here on Yahoo!
2007-10-23 02:52:23 · answer #5 · answered by Anonymous · 0⤊ 1⤋
200,000 because i dont know what it really looks like but i think 200,000
2007-10-23 02:07:26 · answer #6 · answered by MissUnderstood 2 · 1⤊ 0⤋