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In your example you said "and the contract is signed at exactly "market value". You then went on to say the buyer would then come up with 5% worth of items in the inspection. Let's ignore the silliness of that blanket statement for a moment.
Did you really not mean market value? Did you mean below market value?
If you really meant it I say to you again, good luck getting a buyer to offer you above market value with the logic of the number coming down during inspections. If you didn't mean it, why would the seller accept a below market offer?
I commented earlier on BUYING in this market, but, did not mention that we had also recently SOLD similar properties in another Florida market.
Boy! What a different perspective there is between selling and buying! When SELLING, we focused mostly on our property (what we had paid, our upgrades, what we hoped to get, etc). After receiving a couple of what we considered 'lowball offers', we started looking a little more closely at other properties in the market. We then went back to those who had made offers - and countered. Finally, someone else came-in and made a cash offer above what we were actually willing to sell for --- so, we took it. (We had been chasing the market $$down for about 6-8 months by then).
When it came time to re-buy (earlier post; no sense re-hashing), we had an entirely different perspective. First, we clearly defined what we wanted and then put together a standard checklist so we could still objectively compare properties ... when they all began to blend together in our minds. Then, we carefully researched comps for top-interest properties ...deciding how much we were willing to pay for various upgrades and options.
IT'S AMAZING how clear the market value of a property becomes when you take the 'emotion' out of it! 'Market Value is what buyers will pay for a property, NOT what the seller thinks it is worth!' I'm not sure why some realtors play along with sellers who insist on listing properties at 30-70% over market(?) ... except, perhaps, they do it to simply 'get' the listing and then let it sit until the buyer decides to come down in price; ... (or perhaps, they hope some bumpkin with a pocket-full of cash will fall off a turnip truck in front of their listing and fall in love with it ....and it's "breathtaking view.")
Finally, for all you sellers who have listed your properties at a high price, "but, really don't have to sell" -- Who are you kidding? You must still be living in 2005-2006 when all one had to do to attract multiple bids was put a sign out. A lot of realtors who thought themselves 'great salespeople' in that market ... are now working as greeters or shepherds. In case you haven't noticed, buyers are no longer fighting over properties ... sellers are now fighting for buyers! If you really don't want to sell, then why muddy the waters with your little ego trip?
a little over a month late, but by golly this is one of the best assessments of real estate I've seen - and thrilled it came from a consumer not a Realtor!
So glad to find this thread. Was coming here to vent about a ridiculous seller/realtor team and instead I found an oasis of similar tales.
We're dealing with sellers currently who have moved out and are paying monthly for a moldering listing but refuse to even consider negotiating. We're not lowballing, we've offered no more than 10% off of a high list and asked them to counter to no avail. My agent just doesn't get their attitude or even that of their agent who is downright hostile.
Just waiting for the spring market to kick of properly here, inventory is slim......
A few agents suffer from arrogance that gets in the way of a sale happening, but generally it's a stubborn seller that isn't ready to face the reality of the market. The agent isn't getting paid until it closes so they want the contract to work out.
On the last house I purchased, I bid pretty low (because, based on the comps, the house was simply priced way too high, so my offer was fair based on the market). The seller was offended and rejected my offer (and was apparently pretty angry, too).
I wrote a personal letter to them apologizing for offending them, explaining why I felt that was a fair starting offer, and wished them all the best.
Surprisingly, their Realtor called about a week after I'd mailed the letter to say that they'd not only received my letter, but that they accepted my original offer.
Never underestimate the power of friendly communication and a well-written letter.
When I sold my home in 2009. I was taking a huge hit. No short sale.
Similar home down street was listed as a "short sale" for $550k. The last home sold for $580k 2 months previously as regular sale. This was near height of credit crisis.
I put my home up for $525k. Immediately had offers ranging from 460-480k. Completely low ball. I didn't even respond to them.
Got solid offer for $515k 3 weeks later. 27 showings in 3 weeks.
It was crazy. I priced it BELOW the short sale price, below the last regular sale by almost 60k because I knew the home prices were falling and wanted to dump fast. I took a huge 130k hit cause I could afford it.
But some buyers will low ball even aggressively priced homes. To this date the home I sold is still worth $515k. This was in Maryland where prices have held. So I gave these buyers a good deal. The short sale (with much less upgrades than my home) ended up selling for $510k 2 years later than mine after homeowners declared bankruptcy. My mother still lives in neighborhood so I still know what's going on.
When I sold my home in 2009. I was taking a huge hit. No short sale.
Similar home down street was listed as a "short sale" for $550k. The last home sold for $580k 2 months previously as regular sale. This was near height of credit crisis.
I put my home up for $525k. Immediately had offers ranging from 460-480k. Completely low ball. I didn't even respond to them.
Got solid offer for $515k 3 weeks later. 27 showings in 3 weeks.
It was crazy. I priced it BELOW the short sale price, below the last regular sale by almost 60k because I knew the home prices were falling and wanted to dump fast. I took a huge 130k hit cause I could afford it.
But some buyers will low ball even aggressively priced homes. To this date the home I sold is still worth $515k. This was in Maryland where prices have held. So I gave these buyers a good deal. The short sale (with much less upgrades than my home) ended up selling for $510k 2 years later than mine after homeowners declared bankruptcy. My mother still lives in neighborhood so I still know what's going on.
You make a good point about how low the offer is. Moral of both our stories, I believe, is what do the comps say? If the house is too high, as was the case of the one I put a low offer on, than go in low, and if they get mad, write them a kind letter explaining why you offered that amount. They may very well not realize that the comps. don't support their listed price.
If the house is already priced lower than the comps, low balling would likely just make them angry, and for good reason.
I disagree about Maryland prices having held, though. I just sold my MD home to relocate, and I lost 44% of the value. I ate the loss, because a relo. was more important to me than the loss.
I also recently inherited a MD house, and current market value on it is approximately 50% of what it was prior to the recession.
Maryland prices haven't held in the markets I'm in, but they certainly haven't been hit like many other states such as CA, FL, etc.
If only I were acquainted with TX and ready to buy again before prices go back up. Soon, hopefully...
You make a good point about how low the offer is. Moral of both our stories, I believe, is what do the comps say? If the house is too high, as was the case of the one I put a low offer on, than go in low, and if they get mad, write them a kind letter explaining why you offered that amount. They may very well not realize that the comps. don't support their listed price.
If the house is already priced lower than the comps, low balling would likely just make them angry, and for good reason.
I disagree about Maryland prices having held, though. I just sold my MD home to relocate, and I lost 44% of the value. I ate the loss, because a relo. was more important to me than the loss.
I also recently inherited a MD house, and current market value on it is approximately 50% of what it was prior to the recession.
Maryland prices haven't held in the markets I'm in, but they certainly haven't been hit like many other states such as CA, FL, etc.
If only I were acquainted with TX and ready to buy again before prices go back up. Soon, hopefully...
Depends which part of Maryland. Mine was in Clarksville in Howard County....those in the area know how good the area is along with it's outstanding public schools.
Agreed, if you lived in some other parts of Maryland, even PG county outside of DC, you could see a 30% plus drop. But most parts of Clarskville have probably dropped about 15% from peak. But 15% drop of 600K plus homes is a ton of money plus 6% real estate commission plus another 1-2% in closing costs.
Yeah, I am down in Florida now....big difference between Florida and Maryland. Many people in Maryland can eat their losses. People had common sense to put money down or have financial means to buy homes.
Down in Florida...it's a different beast. Still many distress properties and you don't know how much the real value of a property is cause of the shadow inventory...the courts take 3 plus years to bring a home to foreclosure.
Depends which part of Maryland. Mine was in Clarksville in Howard County....those in the area know how good the area is along with it's outstanding public schools.
Agreed, if you lived in some other parts of Maryland, even PG county outside of DC, you could see a 30% plus drop. But most parts of Clarskville have probably dropped about 15% from peak. But 15% drop of 600K plus homes is a ton of money plus 6% real estate commission plus another 1-2% in closing costs.
Yeah, I am down in Florida now....big difference between Florida and Maryland. Many people in Maryland can eat their losses. People had common sense to put money down or have financial means to buy homes.
Down in Florida...it's a different beast. Still many distress properties and you don't know how much the real value of a property is cause of the shadow inventory...the courts take 3 plus years to bring a home to foreclosure.
That explains it. Baltimore Co. here, not Howard.
3 plus years? Good grief!
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