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My wife and I went under contract on a short sale and ended up getting screwed by Fannie Mae and walking away. A house across the street and down a few houses is nearly identical floor plan-wise, is equal in sq. feet (3443 or so), and lot size is .15 acres. The only difference in the houses is that the short sale had a 5th bedroom upstairs and this one of interest has a loft instead.
The same house model down the street sold for 280,000 in August of 2011. The short sale house had a previous offer accepted by the first bank at 275,000 and our offer was 300,500. There are no other comps I have been able to see in the neighborhood in recent times. This model of house was purchased new in 2008 for between 400,000 and 420,000 from the builder.
Now, this house in question is a traditional sale and is listed as saying the owners plans have changed and they are relocating elsewhere. It is listed at $359,000 right now and was dropped 10,000 two weeks ago. The listing was posted originally on Dec. 11, 2011.
This is where I'm needing some advice. I would never offer listing price or even close to it for this house as there are many houses with similar square footage throughout the northern part of this area that are priced in the 300,000 range and below. We have viewed many, many houses thus far in this area and have a good idea of values for Clovis, CA and Fresno, CA.
Is it insulting and ridiculous to offer to these sellers a "take it or leave it" offer in the range of 300,000-305,000 since it is somewhat clear their price is grossly inflated?
I don't want to waste my time, our agent's, or the sellers'. I just don't see the value of this house being more than 310,000 if the entire house is in mint condition.
We aren't willing to go above 305,000 for financial safety reasons. Even for a dream house (which this could be considered) we wouldn't go above that level.
In my experience it is often futile to submit offers that are far below asking even when the data of sold comps is there to support such an offer. It is much more productive to focus on homes that are already realistically priced or wait until the sellers come to their senses and re-set their asking price to something that is realistic...
Have your agent talk to their agent to get a feel for the sellers willingness to take a "market price" offer. Though I have to agree with Chet, if they are that far off on the price, they probably aren't ready for reality. Everyone thinks there is something special about their home that makes it more valuable than the rest of the comps. Eventually the buyers (or lack thereof) will let them know if they are right.
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
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I don't think it's ridiculous to offer what you suggest, but I think, based on your post, that you aren't able to offer much more than that. If I was representing the seller, I'd probably suggest countering your offer somewhere in the middle of the asking price and your offer, say $330K (If my seller was truly motivated). I wouldn't expect the seller to just say OK to your offer.
More importantly, since I don't know the Clovis market at all, what does your agent think?
Whether there are a ton of houses listed in your price range is pretty irrelevant to the one you're interested in offering on.
My initial reaction is to buy one of the non-grossly overpriced homes that are on the market that you are comparing this one to - if this IS the dream home and the others aren't I'm not so sure the price comparison you are doing is accurate.
All that aside your offer isn't that far from 10% off of asking, that wouldn't be considered out of the norm in my area as a starting point. If you want a good deal it always requires writing an offer so I would say go for it - trying is not a waste, if that was my mindset, I wouldn't sell a single home since most buyers are similar to you in that they rarely consider full price in the current market.
My wife and I went under contract on a short sale and ended up getting screwed by Fannie Mae and walking away.
Based on your previous post, FNMA did not care for your offer on the short sale and countered. FNMA did not set the listing price and clearly was not open to it. That's their choice. And that's a far cry from getting screwed by FNMA.
As to this other house.....2 weeks ago it was listed at $369. You are prepared to offer $300-305.That about 19% off of where the seller's head was at just a few weeks ago which makes it unlikly they are going to accept your offer. Having said this, nothing precludes you from making the offer. Worst case, they turn you down or counter at a price you do not want to pay. That's their choice.
If so, why not concentrate on looking for properties that are in your price range? Some of them likely started out listing at substantially higher prices and the market wore them down.
Besides, if you have time to wait & really like that house so much... (since it is overpriced it will not sell anyways), one can always "re-offer" after they re-up their listing again.
I don't know why people (especially agents, make sense, cut into their profits) are so discouraging to "lowball offers"... that is how I got my home that way through a traditional sale.... it is not as though after a "reject" one cannot come back & re-offer when the home is still available. Seriously!
I think you are welcome to try but my guess is that the seller of the house is erroneously thinking they can sell the house without doing a short sale. Your low offer would most likely send them into short sale territory. I know I can lookup someone's mortgage and can extrapolate what their potential payoff is. Have your agent do this for you.
Based on your previous post, FNMA did not care for your offer on the short sale and countered. FNMA did not set the listing price and clearly was not open to it. That's their choice. And that's a far cry from getting screwed by FNMA.
The situation with the short sale was that Fannie Mae, out of nowhere demanded nearly 390,000 for the house. That is just under what it was worth new in 2008. I consider that screwed. I have no problem with Fannie countering with a reasonable offer and then parting ways. An $85,000 difference was just asinine on their part.
To you and everyone else who responded, thank you for the advice.
This house is the most favorable floor plan for us as a couple and our interests that we've seen in the last 4 months of looking but of course there will be others. The price is just outrageous but we definitely are able to wait and hope nobody snatches it up for the high cost before it can drop.
We need to find somewhere and be closing escrow by August so we definitely have time for more looking as long as it is not a short sale. I check the MLS listings every day but we just missed a very large group of VERY favorable houses that were all sold in the two months before we began house hunting.
I will probably wait a month and then when their price inevitably drops again throw out our offer if we are still on the market.
In my experience it is often futile to submit offers that are far below asking even when the data of sold comps is there to support such an offer. It is much more productive to focus on homes that are already realistically priced or wait until the sellers come to their senses and re-set their asking price to something that is realistic...
I always thought the same until this past November. A house came on MLS here for $900K. It went under contract in only 10 days and sold for $750K. When it showed up on MLS I thought "this house is so overpriced it's going to sit forever." Now my attitude is: if the house is overpriced just offer something reasonable. The worst that happens is they say "no."
Of course, this was an "entry only" listing which is essentially a FSBO. FSBO's rarely know what they're doing and will often do some strange things like this.
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