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Old 08-24-2009, 12:31 PM
 
Location: Wakefield
53 posts, read 112,736 times
Reputation: 31

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We just recently returned from a house hunting trip to the coast and we saw many homes available for sale. How much of a discount are these homes going for? Is it appropriate to offer 10-15% below asking price or to go lower and figure it is a buyers market. I don't always believe my agents recommendations because they have a vested interest in getting the highest price possible even though they say they are working for me. Every decrease in price is less for them on commission. Comps imho are not that accurate right now with the market being so sluggish and heading down.
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Old 08-24-2009, 12:34 PM
 
1,067 posts, read 1,782,011 times
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Best look about insurance before buying the property. A lot of coastal property cannot be insured.
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Old 08-24-2009, 12:36 PM
 
22,769 posts, read 26,205,362 times
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My observation has been that there's a glut of beach homes for sale. There is an enormous price disparity between homes that have sold, and the homes that are just sitting on the market asking "whatever."

If somebody wants $2.25m for a house that's supported by $1.25m comps, I mean hell, good luck trying to lowball on that one.

I am at the south end of Wrightsville Beach, and to use some examples...

A front row beach house, appears to be almost-new, 8 bedrooms/8baths, 5,000+sqft, sold for $1.5million.
A 5br on the water, with boatslip sold for $1.4m
Most in this little area have sold for between $750,000 and $1.5million, with one or two that broke $2million.
I recall reading that in 2008, the biggest sale in the county was something like $3.5million, on a gated private island not far away. Nothing in Wrightsville broke $3million in 2008.

Now compare those numbers to the asking prices within the same little area -
$3.2m on the water
$3.9m on the ocean
$2.2 on the ocean
$1.9 on the water, with boatslip
$1.4m, maybe with water views.

So.. I'm not sure what strategy one should employ, trying to buy beach houses right now. Plenty of obstinate sellers out there.

Last edited by le roi; 08-24-2009 at 01:21 PM..
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Old 08-24-2009, 12:39 PM
 
1,067 posts, read 1,782,011 times
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Quote:
Originally Posted by rubber_factory View Post
My observation has been that there's a glut of beach homes for sale.

There is an enormous price disparity between homes that have sold/are selling, and the homes that are just sitting on the market asking "whatever."

If somebody wants $2.25m for a house that's supported by $1.25m comps, I mean hell, good luck trying to lowball on that one.

Skip the greedy opportunists!

Or waste some of their time like they are doing to everyone else.
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Old 08-24-2009, 01:38 PM
 
Location: Jacksonville
160 posts, read 699,339 times
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Quote:
Originally Posted by husbandofraleighwife View Post
We just recently returned from a house hunting trip to the coast and we saw many homes available for sale. How much of a discount are these homes going for? Is it appropriate to offer 10-15% below asking price or to go lower and figure it is a buyers market. I don't always believe my agents recommendations because they have a vested interest in getting the highest price possible even though they say they are working for me. Every decrease in price is less for them on commission. Comps imho are not that accurate right now with the market being so sluggish and heading down.
I'd offer AT LEAST 15% less than list price and you need to be real careful what you place an offer on because similar homes can easily vary in asking price by 20-50% at the beaches. Personally, I wouldn't even walk into a beach house that wasn't a foreclosure or short sale but that's just me. Keep in mind that whatever you buy (assuming you buy in the next few months) may very well be worth less than what you paid a year from now. By no means have we hit the bottom of the market, especially on the coast.

Yes the comps right now are accurate assuming you are getting them from an unbiased source and not an agent cherry picking them to "justify" someone's asking price.

Most real estate brokers are obviously motivated by commissions. You are correct in being cautious. Most agents I deal with are generally knowledgable, honest people but I've seen some screw their clients to the tune of tens of thousands of dollars.
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Old 08-24-2009, 04:29 PM
 
214 posts, read 736,516 times
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Quote:
Originally Posted by NCGT View Post
I'd offer AT LEAST 15% less than list price and you need to be real careful what you place an offer on because similar homes can easily vary in asking price by 20-50% at the beaches. Personally, I wouldn't even walk into a beach house that wasn't a foreclosure or short sale but that's just me. Keep in mind that whatever you buy (assuming you buy in the next few months) may very well be worth less than what you paid a year from now. By no means have we hit the bottom of the market, especially on the coast.

Yes the comps right now are accurate assuming you are getting them from an unbiased source and not an agent cherry picking them to "justify" someone's asking price.

Most real estate brokers are obviously motivated by commissions. You are correct in being cautious. Most agents I deal with are generally knowledgeable, honest people but I've seen some screw their clients to the tune of tens of thousands of dollars.

Foreclosures are your best option in this market if you are looking for a beach home. You won't be dealing directly with the Seller/Owner, and you may get into a bidding war with other buyers, however, if you are working with a knowledgeable Buyers Agent specializing in foreclosures, you should be able to find a good deal. It will ultimately depend on the Bank however, and they can take forever in reaching a decision. Best get pre-approved for a loan, or provide proof of funds before starting or submitting your offer. Will make things go a lot smoother for you.
Also please keep in mind the closer you are to the coast, the more desirable the location. We may not have hit bottom, but I strongly believe property values here will return to increasing in value, in a couple of years, more so than in other places.
Good luck, and don't just buy for the investment value, buy something that you want to hold onto for awhile.
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Old 08-24-2009, 04:31 PM
 
693 posts, read 1,407,355 times
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I would always lowball. We're not in a seller's market. If they don't like your offer they'll counter. If they get "offended", so what? Offend them. You are out to buy a home, and you need to look after your own interests first. FYI, lots of realtor's websites have "sold" pages, so you can likely find a home that is comparable to what you are interested in buying and see what the going rate was.
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Old 08-24-2009, 07:04 PM
 
Location: Swansboro
148 posts, read 555,363 times
Reputation: 69
Your offer should be what you want to offer, period...Not every seller is in trouble, not every seller has to sell...You want a property lower than what it is listed for, but most sellers are going to say, 'see you later'......Most sellers are not in a predicament in this area, it isnt Florida...

At an auction there are always the ones looking at there books to see what something is worth according to some printout....but there is always someone who bids, and bids, and bids up the price, why? Because to them it is worth it....they want it...to them it is valuable....to them it is the pearl of great price....

If a property is an investment, then treat your offer as one, but if the property is the 'pearl of great price' then no price is unreasonable....

Most people buying a property are buying with someone elses interests involved also, like a wife or husband....I believe that taking the other persons feelings into consideration, far outweighs the missed opportunity that aquiring a property will give joy to someone vs. saving a buck....We only live once in this life, its not all about money, the money someone will save isnt nothing when weighed upon how short life really is....

Buy the home you want, buy for happiness, money is nothing vs. the joy of spending time in a home you enjoy...
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Old 08-24-2009, 07:57 PM
 
1,958 posts, read 2,632,373 times
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i will second everything Steven Mc Curdy said!!

of course you should try to get what constituetes a deal for you.
we knew what house we wanted and gave a lowball offer , worked our way to a price point where everybody was happy.
still came in 30 % under listing price. this was at the end of 2008.

when the time comes to sell again hopefully we will earn a decent amount on the house ,meanwhile we are happy as clams.
the days of scoring big on buying and selling houses is gone [ for now] as long as we don't loose money and we have been happy living here in the mean time , that's what counts.
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Old 08-25-2009, 05:47 AM
 
Location: Wakefield
53 posts, read 112,736 times
Reputation: 31
Thanks for all of the advice although I am interested to understand why many of you think that prices will continue to drop this coming year. It seems to me that activity is picking up in the Oak Island and Holden Beach area and the news media seems to suggest that we are "near the end." We are presently evaluating a few homes and trying to evaluate price, budget and our own utilization. I agree that the future of the North Carolina coast is excellent since the local areas (Raleigh and Charlotte) will continue to grow and people will always want to visit the beach.
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