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We're first-time home-buyers interested in a particular house. I know there are a lot of factors to consider when submitting an offer - but I'm just going to share the basics of what we know.
The list price on the home is $225,000.
4 houses on the same street sold last summer for anywhere between $195,000 - $205,000.
The house has been on the market about a month.
And finally..
A house on the same street just came on the market today for $224,900. They are holding an open house this Sunday.
Here are the major differences (to me- at least) between the houses:
The newer sale 300 more SQ feet (in the basement.)
The newer sale has new hardwood flooring and carpet.
The newer sale has a new HVAC/H20 Heater/Humidifier.
The other house has 1 more bathroom.
The other house has a deck.
The other house has a walk-out to the backyard.
So - whatever one house has the other doesn't. For instance, the other house doesn't have new
carpet.. it's berber.
We are thinking of offering $215,000 plus closing costs (about $7,000) for the house that has been on the market for a month.
Do you think it would be "insulting" if we were to go lower? Or are we already too low?
Also - how does the new listing across the street affect our offer? Does it at all?
Thanks for any help, advice, or tips.
P.S. FYI we do have an agent. I'm just wondering if she has our best interests in mind. She earns 3% of what the house sells for - so I am skeptic. She advised us to offer $220,000.. but if they were to counter that at $223,000 it's hardly seems worth it.
We're first-time home-buyers interested in a particular house. I know there are a lot of factors to consider when submitting an offer - but I'm just going to share the basics of what we know.
The list price on the home is $225,000.
4 houses on the same street sold last summer for anywhere between $195,000 - $205,000.
The house has been on the market about a month.
And finally..
A house on the same street just came on the market today for $224,900. They are holding an open house this Sunday.
Here are the major differences (to me- at least) between the houses:
The newer sale 300 more SQ feet (in the basement.)
The newer sale has new hardwood flooring and carpet.
The newer sale has a new HVAC/H20 Heater/Humidifier.
The other house has 1 more bathroom.
The other house has a deck.
The other house has a walk-out to the backyard.
So - whatever one house has the other doesn't. For instance, the other house doesn't have new
carpet.. it's berber.
We are thinking of offering $215,000 plus closing costs (about $7,000) for the house that has been on the market for a month.
Do you think it would be "insulting" if we were to go lower? Or are we already too low?
Also - how does the new listing across the street affect our offer? Does it at all?
Thanks for any help, advice, or tips.
In any sales situation someone has to make the first move, someone the 2nd, someone the 3rd, etc. until both parties agree or one walks away.
1st step...they listed the house.
2nd step..you make an offer.
3rd step...they do something...refuse..counter...ignore.
The less conditions/qualifications your offer contains, the more attractive it will be. Like no house for you to sell, etc.
The more you can get financing the more attractive your offer will be. Pre-approval letters, etc.
1. Who cares if you "insult" them. Make what you think is a fair offer.
2. Why did you even hire an agent if you feel like they don't have your best interest in mind?
> I'm just wondering if she has our best interests in mind.
Presumably you are inclined to buy a house. If not, you should bail out now.
Otherwise- the agent wants to sell you a house. This one would be nice because she has already showed it to you. She would suggest a price she thinks is likely to be accepted, or at least close enough to be in bargaining range. Think of it as advice- if you really think the house is worth less you should offer less. Your chance of getting it may be less if you offer less (the seller may not counter your offer).
The difference between what she makes on a high offer and a low offer is pretty small. From her point of view it is probably not worth risking no sale to get a little bit higher commission.
> I'm just wondering if she has our best interests in mind.
Presumably you are inclined to buy a house. If not, you should bail out now.
Otherwise- the agent wants to sell you a house. This one would be nice because she has already showed it to you. She would suggest a price she thinks is likely to be accepted, or at least close enough to be in bargaining range. Think of it as advice- if you really think the house is worth less you should offer less. Your chance of getting it may be less if you offer less (the seller may not counter your offer).
The difference between what she makes on a high offer and a low offer is pretty small. From her point of view it is probably not worth risking no sale to get a little bit higher commission.
$215k with $7k for closing costs means you're offering $208k. I could see why your agent doesn't like that offer if the house is fairly new on the market. For her to say $220k, that is still with $7k closing costs, so you're actually offering only $213k for a house listed at $225k. How is that too high? And if they do counter at $223k, you're still at $216k. Are you doing the math correctly to see my point? They wouldn't be coming down just $1k because YOU'RE ASKING THEM TO GIVE YOU BACK AN ADDITIONAL $7K FOR YOUR OWN CLOSING COSTS.
$215k with $7k for closing costs means you're offering $208k. I could see why your agent doesn't like that offer if the house is fairly new on the market. For her to say $220k, that is still with $7k closing costs, so you're actually offering only $213k for a house listed at $225k. How is that too high? And if they do counter at $223k, you're still at $216k. Are you doing the math correctly to see my point? They wouldn't be coming down just $1k because YOU'RE ASKING THEM TO GIVE YOU BACK AN ADDITIONAL $7K FOR YOUR OWN CLOSING COSTS.
It is amazing that not only Buyers do not understand asking closing costs is actually a lower offer but the RE Agents who also do not comprehend the concept. In your example above agents will respond "We're offering you $220k, that's a great offer".
No it's not. It's not $220k but in actuality only $213. Why do agents not get that and explain it to their clients ???
Ok Falcon-dude-man. No need to e-yell at me to get your point across. Chill out.. seriously.
My main concern is that houses with the same layout, in the same neighborhood, on the same cul-de-sac with similar upgrades sold 12 months ago at 198 low and 205 high. I admit - I know little to nothing about real-estate, and I don't know the inner-workings of those deals. But are you trying to tell me the market has inflated that much in a year?
And yes. I feel kinda like a doofus for over-looking the fact that we're talking about a $150 difference in our Realtor's 3% commission. But when family and friends (with only the best of intentions - wanting us to be cautious & thorough) are telling us to beware of Realtor's and their selfish intentions, and why we shouldn't fully trust them, blah blah blah - I guess I'm getting/got paranoid.
No it's not. It's not $220k but in actuality only $213. Why do agents not get that and explain it to their clients ???
I don't understand why agents don't explain this either. It's simple math, common sense, and real estate 101.
Quote:
Originally Posted by MRB86
I admit - I know little to nothing about real-estate, and I don't know the inner-workings of those deals. But are you trying to tell me the market has inflated that much in a year?
Then you should take advice of your agent if you're going to admit you have no idea what you're doing. I don't know about your immediate market, but in Austin, my market, everything is in a supply and demand situation and houses are flying off the shelves. For the entire Austin metro area, the median sales are at 97.7% of asking price. That's a hot market. Yes, prices can change that much in a year, especially if your market is seeing its up-tick. Last year has no bearings on this year. You should compare to the past 60-90 days, not 6-12 months.
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