Found a 12 yr old 3,200 sqft house we want to buy that needs some work. It has been moved 200 yards to make way for a new development. Its structurally sound but needs new kitchen countertops (granite), molding replaced, addit. insulation added (they skimped on this) and needs all the wood single pain windows replaced, some won’t open and some have gaps
The seller bought the house as an investment. He got the house for about $79k, land for $49k, and about $60k to move it and add new carpet, paint and some upgrades (New HVAC and Hot Water Heater). He has approx $190,000 in the house. He added “Desperate Seller, Make offer” to the posting. The agent said he is over extended and needs to move it or probably lose it soon.
He has lowered the price from $420K to $399K, to $345K. It has been on the market since Jan. with little interest. With the needed improvements ($30-$50K) Is $250k a good offer for a “Desperate Seller”? He would still make $50k+ is this a fair offer or way too low?
2007-12-03 01:57:42 · 12 answers · asked by wvuap372 2 in Business & Finance ➔ Renting & Real Estate
Just to clarify, I know this offer wouldn't be fair to a normal seller.
I am asking if offering $250,000 ($95,000 under asking price) to a seller that is "desperate" saying "make an offer" that will lose the house in about 2 months if he doesn't sell it is fair? He would still make $50k - $60k. Could I go lower? or do I need to go higher?
2007-12-03 02:02:45 · update #1
The house has been checked out and is structurally sound, so that is not a problem. The seller bought the house (and 2 others in the neighborhood) as investments. He bought the houses cheap and had them all moved to new lots a few hundred yards away in hopes of flipping them quickly. The houses didn't sell as quickly as he had hoped (due to the market slow down) and he is now over extended and risks losing the house.
The real estate agent represents him, but she is telling me how desperate he is and that he REALLY needs to move the house. I know she is in it for herself trying to sell it for as much as possible, but I also think she realizes that she will make nothing if the bank forecloses.
Thank you all for your great answers
2007-12-03 02:24:37 · update #2
First set the price you are willing to pay in your own mind. Sounds like $250K. Offer what you believe will be his dead bottom. Might be $190K. He will(more likely than not)reject that offer, be insulted, call you names, etc. Do not be disturbed, this is normal. If he doesn't counteroffer, ask what he would be willing to accept because you aren't interested in paying much for his property. This will break the emotional barrier of real estate sales and purchase. He will begin to think in realistic terms. He took a risk and it didn't pan out, time to cut his losses. He will be ready to deal with you on a strictly business level now. Hold your number. Be ready to walk away. He will more than likely lower his current list price but not to where you are. Come up a little off of your initial offer, say $220K. This will cement in his mind that you are deal shopping. He will probably give you a final offer that is higher than your $250K. Tell him $250K is your final number and do not, under any circumstances, contact him again. I had a purchase that I walked away from and 6 months later they contatcted me and we made the deal for 10K less than my final offer.
2007-12-03 02:45:38 · answer #1 · answered by kirk m 3 · 1⤊ 0⤋
It doesn't matter what the seller has in it, or what he's TRYING to sell it for - WHAT'S IT WORTH?
It's obviously not worth $420k or $345k, since it hasn't sold. It sounds like the seller's trying to hit a "home run" with this investment.
If it's worth $300k fixed up, and you offer $250k, and put $50k into it, then how is that a good deal? You could just buy another property that's already fixed up if you wanted to put $300k total into it.
Me personally, I'd get a REAL GOOD idea what the home is worth in good shape, (an unbiased 3rd party, not the real estate agent) ...then take DOUBLE the repairs off that price (to leave you some room for error).
If that number happens to come in at $180k, then that's what I'd offer. I don't care what the seller has into it.
Don't pay for the seller's mistakes. That would make you a "motivated buyer". If he/she originally overpaid for the property, then don't bail them out by making a ridiculous offer.
2007-12-03 05:05:39 · answer #2 · answered by benebuck8 2 · 1⤊ 0⤋
Before you do ANYTHING with this house, engage the services of a qualified structural engineer to thoroughly assess the property. You state that it is 'structurally sound, but was it put properly level on its new foundation ? There is no reason that windows should be stuck shut in a twelve year old house. It's possible that the house is now out of level and that the framing has moved to the point that the windows are receiving pressure from the twisted framing. Same goes for those with the gaps.
I have to question whether this house was moved properly and put on its new foundation properly. Invest the money before you do anything further. If this house is not sitting properly, you are buying way more problems than you want to think of.
2007-12-03 02:44:35 · answer #3 · answered by acermill 7 · 0⤊ 0⤋
Your offer sounds more than fair. I'd offer even less working on the theory that you can always take your offer higher but not lower. With a 'desperate' sale you are in some respects playing a game of chicken. Be willing to walk away from the sale if the seller is not as desperate as he would have you believe. Remember the agent is working for the seller and has his best interest at heart NOT yours. Good luck.
2007-12-03 02:07:56 · answer #4 · answered by al 6 · 0⤊ 0⤋
The thing about "lowball" offers is - the buyer can always reject or counter, and you can inch up your offer. If it were me, I'd start at 200-k and work your way back up to 250k. But that's just how I roll...
All your edits have done nothing to make me change my opinion. The "fairness" in a real estate transaction comes from the seller's ability to say "no thank you" to an offer and make a counter offer. Sheesh!
2007-12-03 02:02:14 · answer #5 · answered by Slappy McStretchNuts 5 · 0⤊ 0⤋
I would start my offer at what he has in it and offer to pay closing costs.. then you will find out how "desperate" the seller is. Make an offer with a quick closing pending title search and home inspection. Be ready to pay cash if need be. Set a limit to what you will pay. It is OK for the seller to make a profit, but their situation is not your problem. You are also an investor looking to get into a house in a market that is not a great one for people looking for equity buildup.
2007-12-03 02:12:25 · answer #6 · answered by Rafael P 4 · 0⤊ 0⤋
Be very wary if it has been moved 200 yards it might be structurally unsound its only worth what somebody wants to payif you make an offer make sure you stipulate its subject to survey if its been on the market since january $250K is very reasonable he has two choices
2007-12-03 02:06:04 · answer #7 · answered by golden 6 · 0⤊ 0⤋
if you did all your research on the house and you feel it's worth the risk make the offer before some one else ...
ps caution houses that are moved can be structually unsound and there is always a hidden reason the seller is selling.
FIND OUT WHY HE IS REALLY SELLING!
2007-12-03 02:05:52 · answer #8 · answered by jax rax 3 · 1⤊ 0⤋
That sounds fine to me. You are actually paying him more than he needs to pay off his debt. So, you are doing more than most people who buy from DESPERATE seller.
He may counter and you can go from there. You don't ever have to feel bad about low balling people in real estate.
2007-12-03 02:35:10 · answer #9 · answered by Anonymous · 2⤊ 0⤋
The best thing we have going for us in this world is our integrity. Make the offer base on what is good for you, what you be live is fair to the other party. Don't bring any other sinister motive into picture.
2007-12-03 02:14:43 · answer #10 · answered by LtJb85 1 · 0⤊ 1⤋