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Old 08-05-2014, 10:18 AM
 
Location: St. George, Utah
755 posts, read 1,115,611 times
Reputation: 1973

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It sounds like you know how to look at comps, compare price per square foot with an eye toward differences in finishes, lot size, etc. You get it. So go with your gut.

We had a good realtor on this last search, but it still came down to our own examination of the comps she pulled for us (plus looking at the comps myself). We were aware that we were paying the high end of price per square foot, especially given the specific location & mediocre finishes. But our house was move-in ready and was one of the few with a pool big enough for our kids. We decided not fuss about a few thousand dollars in this case, and we're glad we didn't as absentee homeowners.

YOU are looking, however, to build instant equity and sweat equity over time. As Zippyman says above, that takes time and effort these days, and a realtor who is very knowledgeable, patient, and helpful. It helps a lot that you understand how to pin down market value, how to analyze comps.

Go with what you think is the right number. I know there is the fear of offending people, but if you know your number and it's based on comps, A) You won't feel bad if you don't get the house, since you know you don't want to overpay and B) You can explain your reasoning to the listing agent with links to the comps you are looking at, to help ease the sting. "I'm not trying to lowball you, and here's the evidence."

And get a realtor who IS working for you.
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Old 08-05-2014, 10:46 AM
 
Location: Amongst the AZ Cactus
7,068 posts, read 6,439,807 times
Reputation: 7730
Something else to keep in mind. It appears home sales in the Phoenix metro is and has been for a while in a bit of a slump based on indicators which of course should be good for buyers.

Check out the Cromford Market Index on this page:

The Cromford Report

A few stats from a recent media report:

Home prices climb, but sales slump
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Old 08-05-2014, 12:24 PM
 
Location: Buckeye
604 posts, read 930,968 times
Reputation: 1395
Quote:
Originally Posted by John7777 View Post
Don't forget who the realtor works for. Hint: it isn't you.
A Buyer's Agent does work for you. True, they are paid commission from the selling broker but a good realtor wants referrals from satisfied customers. The satisfaction of a customer is more important than the commission off one sale. Satisfied customers tell others and a realtor's business will grow exponentially.

It is a mistake to think a realtor does not have their client (you) first and foremost in their mind.
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Old 08-05-2014, 05:08 PM
 
Location: Out there somewhere...a traveling man.
44,575 posts, read 61,375,226 times
Reputation: 125613
Make the offer you're real comfortable with and then you'll find out the seller's real need and motivation to sell. What a seller and realtor BS about may be negated by what the seller does after the offer is made. Do your due diligence first then make your offer based on that.
For instance one of the houses I bought the seller and the realtor said there was no hurry to sell, yet I made a lowball offer in which the seller countered and then I re-countered and the deal was consummated. Saved over $100,000 on a house listed for $325,000. Paid cash with a 2 week closing. Seller was elated. Found out later the seller needed to sell as fast as possible due to severe $$ obligations and could possibly lose the house to foreclosure.
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Old 08-05-2014, 05:48 PM
 
Location: LEAVING CD
22,974 posts, read 26,922,533 times
Reputation: 15644
Quote:
Originally Posted by MN-Born-n-Raised View Post

Jimj, I disagree with your statement about upsetting someone. It depends. If someone lowballed me on my home I'd be offended. If I felt comfortable knowing I could sell it to someone else in a reasonable amount of time, I would not bother countering. I'd tell my agent to call them and let them I was offended. When I would refuse to counter, they would figure out they just screwed themselves out of trying to see if I was stupid.

I've factually black balled low-ballers from buying my homes or properties. Forgetting my emotions, I picture problem buyers (think arbitration) in the coming months.

A lot of words to let you know there is a subset of us sellers where it does hurt to ask. A $10K low offer is fair. A $30K offer that is really below the market is a slap in the face.
Or you just screwed yourself out of someone who was willing to buy but wanted to see where the bottom was.
I have never failed to counter. I admit I've laughed quite loudly at some offers,called them insane (and then countered) but they are only "offers" nothing personal or insulting. By the way, a couple of those insane people ended up agreeing to an acceptable price after a couple back and forth faxes.

I stand by my statement that black balling or whatever you want to call showing a buyer how insulted you were that they dare offer below what you think is proper or is a "slap in the face" is just poor business by allowing emotion to enter a pure goods for money transaction.
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Old 08-05-2014, 06:04 PM
 
Location: Rural Michigan
6,343 posts, read 14,633,508 times
Reputation: 10548
Quote:
Originally Posted by jimj View Post
Or you just screwed yourself out of someone who was willing to buy but wanted to see where the bottom was.
I have never failed to counter. I admit I've laughed quite loudly at some offers,called them insane (and then countered) but they are only "offers" nothing personal or insulting. By the way, a couple of those insane people ended up agreeing to an acceptable price after a couple back and forth faxes.

I stand by my statement that black balling or whatever you want to call showing a buyer how insulted you were that they dare offer below what you think is proper or is a "slap in the face" is just poor business by allowing emotion to enter a pure goods for money transaction.
I suppose it depends on the seller - when I list a property, I do the research & get the list price right. I've also given my agent instructions to toss offers below a given threshold without bothering me.

No matter how you slice it, "lowballing" is playing a game & some sellers aren't interested in playing games. For every "lowballer" who actually has the funds to complete a deal at a reasonable price, there are two whack-a-doodles who watch too much late-night tv & assume they can negotiate fat stacks like the bald guy on "Pawn Stars"..lol.. not happening..
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Old 08-05-2014, 06:40 PM
 
Location: Scottsdale, AZ
563 posts, read 1,782,405 times
Reputation: 534
Quote:
Originally Posted by GeneR View Post
A Buyer's Agent does work for you. True, they are paid commission from the selling broker but a good realtor wants referrals from satisfied customers. The satisfaction of a customer is more important than the commission off one sale. Satisfied customers tell others and a realtor's business will grow exponentially.

It is a mistake to think a realtor does not have their client (you) first and foremost in their mind.

Does a car salesman work for you?
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Old 08-05-2014, 06:46 PM
 
9,189 posts, read 16,587,634 times
Reputation: 11291
Quote:
Originally Posted by PNWGuy View Post
Does a car salesman work for you?
Poor analogy. Does a financial advisor?
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Old 08-06-2014, 06:16 AM
 
9,682 posts, read 11,083,909 times
Reputation: 8429
Quote:
Originally Posted by jimj View Post
Or you just screwed yourself out of someone who was willing to buy but wanted to see where the bottom was.
I have never failed to counter. I admit I've laughed quite loudly at some offers,called them insane (and then countered) but they are only "offers" nothing personal or insulting. By the way, a couple of those insane people ended up agreeing to an acceptable price after a couple back and forth faxes.

I stand by my statement that black balling or whatever you want to call showing a buyer how insulted you were that they dare offer below what you think is proper or is a "slap in the face" is just poor business by allowing emotion to enter a pure goods for money transaction.
We certainly agree much more than we disagree. As I mentioned before, I would handle a low ball offer differently if I knew it will sell. When we sold our last home, it was on MLS. I paid 3.25% (from memory) to the selling agent and $500 to the listing agent which was his low margin business model. But I handled every inquiry. I had 40 showings and plenty of offers so I held my ground. I knew it would sell. I didn't want contingencies either and turned down two offers. If someone wanted the home and low balled me, I would have called the agent back and let them know their offer was a pipedream. If asked for a counter, I'd say "I value my time and it seems they cannot afford it."

IMHO, it's rational to allow emotions to enter a business transaction. Like it or not, it happens that way in THOUSANDS of transactions every single day. Emotions is how people buy and emotions enter into how people sell. That's reality.
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Old 08-06-2014, 09:46 AM
 
Location: LEAVING CD
22,974 posts, read 26,922,533 times
Reputation: 15644
Quote:
Originally Posted by MN-Born-n-Raised View Post
We certainly agree much more than we disagree. As I mentioned before, I would handle a low ball offer differently if I knew it will sell. When we sold our last home, it was on MLS. I paid 3.25% (from memory) to the selling agent and $500 to the listing agent which was his low margin business model. But I handled every inquiry. I had 40 showings and plenty of offers so I held my ground. I knew it would sell. I didn't want contingencies either and turned down two offers. If someone wanted the home and low balled me, I would have called the agent back and let them know their offer was a pipedream. If asked for a counter, I'd say "I value my time and it seems they cannot afford it."

IMHO, it's rational to allow emotions to enter a business transaction. Like it or not, it happens that way in THOUSANDS of transactions every single day. Emotions is how people buy and emotions enter into how people sell. That's reality.
I concur with how you'd respond, especially if it's priced correctly and the market is moving along briskly. Trouble is many sellers list their homes with unreasonable expectations many times bolstered by their agents or with the idea that they'll have to bargain away some of the asking price so it's inflated beyond reason. The other thing that tends to happen is sellers act like they're selling their first born, inserting their love for a home and/or their memories into the deal and allowing that emotion to run things which is why some get so upset and insulted.

When I countered low ball offers it'd usually be a couple thousand below asking to see where it went from there. I figure it only takes a few minutes of my time to pass my thoughts on to my agent (along with my laughter) and then go on with my day.
Now if I was handling all communications personally I might see things a bit different.
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