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The house has not been updated since the 80’s. Print wallpaper in kitchen and baths, small tile counters, older appliances, older cabinets, orange carpet throughout house, no updating in any bath. Estimate at a minimum $15,000 for painting, appliances and flooring. Solid surface counters and bath upgrades could include an additional $15,000.
Sold Comps: $119 & $121 per square foot – These two properties were completely updated: hardwood floors, freshly painted, granite counters in all wet areas, tile floors, new stainless steel appliances.
$100 sq ft foreclosure – cash deal – needed some updating.
My offer was based on the following pieces of information (which may or may not should have been considered, but I did):
1) The house has been on the market for greater than 400 days! It has only been reduced $6,000 from the original list price.
2) The property is vacant. Tax statements are mailed 350 miles away.
3) Based on appraisal district records, this is the original purchaser from the 80’s. Financed $45K in 1999. Refinanced for $77,000 in 2003.
I was going to counter at $218,000 w/$3,000 allowance which would be a 90% offer. However, my realtor is pushing for $225K w $3,000 for a net of $222K or $116 sq ft.
I thought it was a good offer. Now that I’ve typed this out, my original offer wasn’t that low. With the minimum updates, this works out to $119.59, right at the comps.
What do you think? Don’t you consider the amount of updates required and then compare to comps? Would you buy at 91% of list knowing you had to put an additional $30K in upgrades and would therefore put you well over the comps?
Your realtor has no incentive to save you money. Think about it, what is his/her comission difference between $218,000 and $229,000? Like a $100? He has every incentive for you to get a deal done, and not much to go through it again on the next house. They are only suggesting you go higher to get the house sold and put a check in their pocket.
But everyone else is right, the seller is unmotivated. You won't get a deal from an unmotivated seller. Just rase the $3,000 you suggest and see what happens unless you really love the house and want it.
I agree that 400 days on the market suggests the seller doesn't care what your rationale is, if it's not the number they want they're not playing ball.
Instead of getting caught up in the % of list and the price p/sq ft, decide how much you want the house and whether you are willing to pay what they are willing to accept or not.
Maybe before you, nobody made an offer and the contract with the listing agent is not expired yet, that's why the house still in the market? I though your offer is fair and generous enough.
At over 1 yr listed and only a minor reduction, the owners clearly don't have to sell! So continue to negotiate ro walk, your choice. But I would not expect them to come down uch if any more.
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