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Well I am back with my update on the house situation after my last post on unclean houses we saw.
As a buyer I am really shocked at the attitudes of sellers. Here is the story:
My husband went to the place we were buying, in upstate New York in the Adirondacks. We looked at four towns and at 9 houses priced between $175,000 and $250,000. We were preapproved for a mortgage and using 60-80% cash down. We could have gotten LOTS more but didn't want to. We wanted to buy an old home with a maximum value of $250,000 in good condition or less than $175,000 for one that needed work. We found several and after a week house hunting we found one that seemed perfect for our needs though it needed work.
Lets talk about the house we made an offer on: The village it was in was small, remote and half of it was badly depressed but for our personal needs it fit the bill. It was a large Victorian era home that needed roof and other work to the tune of $50,000 or more to make it habitable. The house had been unoccupied for 5 years and on the market for more than a year! It was purchased 58 years ago and paid off. It had dozens of showings and no offers. It was being offered for $225,000. We knew that price was completely unrealistic as the CMA showed that homes sold for an average of $135,000 in the GOOD part of town. Still we liked it and wanted to negotiate.
After much discussion we made an offer for $160,000. They countered with $200,000. We countered by going up $12,000 but knew the work on that house would swallow the remainder of our money. Considering the remote location and no future potential to sell it for higher than we would pay (in a booming market even). The sellers realtor came back and said "Give us your last final price and my client's kids will get my client to accept the offer." Reluctantly we decided to play this game. We gave them a final firm price of $175,000 ... which with repairs would come out to their asking price or more.
They never came back. Our realtor went back to them and demanded they accept or reject the offer... after a week ... No news so we pulled our offer.
We were insulted that the clients would not even come back with a response. The town they live in is depressed, miles from a major town and as our realtor told them "This family are not just the perfect buyers for this house they may be the only buyers for this house."
We are now looking for another home.
Our big issue is something we see on this forum - SELLERS ARE UNREALISTIC ABOUT THEIR HOME PRICES IN THIS MARKET!
The seller would not budge below $200,000. We are sure they did not want to sell it unless they got a nice round figure. Now we told our agent to only show us houses that the sellers actually want to sell. We offered closing in 45 days - which for that area is lightnening fast!
These "sellers" wasted our time, tied up our money and have disillusioned us ... we not mercenary investment buyers, we just happen to have the personal money to buy a home at this point ... if sellers aren't going to be realistic they will not sell their homes ... at this point we won't even entertain re-negotiating with them or anyone who isn't motivated.
As I said before all of the houses seen were in disrepair, uncleaned and seemed to have no maintenance done on them, but buyers wanted top dollar! Yeesh ... - these also houses were put on the market during the boom! So sellers have a "hot market" mentality. Some people need to get over themselves ... the market has changed and sellers need to recognize that buyers at this time are making low offers because thats the value of the home as the market sees it. You are not "giving away the farm" you are selling your house for money - thats all.
Housing prices are going to continue to go down and buyers who offer today are going to be losing equity if the market keeps going down so anyone who comes with an offer is taking a risk on your home. Don't hate the player, hate the game!
If you don't have to sell, pull your home off the market and wait for the bottom and save yourself and others the hassle.
People in the Adirondacks are mostly sticking with their prices because people will eventually buy them for what they are asking. I grew up in Essex County and my family still lives there so I have info on what is going on. Some of the little places are being 'discovered' since Gov. Pataki moved up there. Also, like you said, the house is paid off so if the kids are just paying taxes, it is likely they will keep it until someone pays their price.
Good luck on your home search, something great will work out for you!
Location: Halfway between Number 4 Privet Drive and Forks, WA
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Quote:
SELLERS ARE UNREALISTIC ABOUT THEIR HOME PRICES IN THIS MARKET
That may be partially true, however, you will find alot of sellers are drawing a line in the sand with unmotivated buyers (for example those buyers submitting unrealistic offers). I don't think that's your case as you've explained about the work needed on the house and you made an offer to reflect that.
Good luck, maybe there's something even better for ya'll around the corner...
poshaccent, it is the same way here in FL. I made an offer on an older home that had been inherited free & clear 10 years ago. The offer was reasonable for the location, condition, and age of the home. Seller never responded to the offer. Offer was not for asking price, as the asking price was absurd for the home. It has happened to us more than once.
Even bank owned properties that are ready to collapse from water intrusion and/or termite damage are sitting and sitting because nobody will budge off of list price. When you can't get a bank to sell a non-performing asset for $5,000 off of list in a tanking market when you have cash in your hand........
Final straw for us was an FSBO that we have always liked from the outside. House has been vacant for years. Peeking in the windows you can tell the house needs quite a bit of work. One day an ad appears in the local paper. Owner, who paid cash several years ago and who did not borrow against the equity wants to sell for double his purchase price. We made an appointment & went to see the house. Seller did not even bother to sweep the floors. Roof leaks and plaster ceiling has failed in several spots. Plaster sits on the floor where it fell. Much termite damage to the floors, so much so that the fireplace is sinking, mortar has all failed, and is about to collapse. Termite wings an inch thick on the floor. Fire damage in the kitchen. 80 year old tub/toilet still there. Seller not budging on asking price.
3 weeks ago we decided to rent. We will not be bullied into over paying for a depreciating asset.
poshaccent, it is the same way here in FL. I made an offer on an older home that had been inherited free & clear 10 years ago. The offer was reasonable for the location, condition, and age of the home. Seller never responded to the offer. Offer was not for asking price, as the asking price was absurd for the home. It has happened to us more than once.
Even bank owned properties that are ready to collapse from water intrusion and/or termite damage are sitting and sitting because nobody will budge off of list price. When you can't get a bank to sell a non-performing asset for $5,000 off of list in a tanking market when you have cash in your hand........
Final straw for us was an FSBO that we have always liked from the outside. House has been vacant for years. Peeking in the windows you can tell the house needs quite a bit of work. One day an ad appears in the local paper. Owner, who paid cash several years ago and who did not borrow against the equity wants to sell for double his purchase price. We made an appointment & went to see the house. Seller did not even bother to sweep the floors. Roof leaks and plaster ceiling has failed in several spots. Plaster sits on the floor where it fell. Much termite damage to the floors, so much so that the fireplace is sinking, mortar has all failed, and is about to collapse. Termite wings an inch thick on the floor. Fire damage in the kitchen. 80 year old tub/toilet still there. Seller not budging on asking price.
3 weeks ago we decided to rent. We will not be bullied into over paying for a depreciating asset.
Good for you! Stick to your guns...I'm going to try to buy next year but if I run into the same problems you have, I'll just wait it out in a rental until sellers understand reality.
The DFW metro area doesn't have quite the same problems as the rest of the country, but if you look at listings in some of the newer suburbs (McKinney leaps to mind), you'll see page after page of "FORECLOSURE!" and "REDUCED for quick sale" captions on houses that are still (IMHO) overpriced. No way I'll offer full price for a house; I'll probably start at 15% below asking. If they don't like that, there are plenty of other houses on the market. Given the conformity in the suburbs, I'm sure I can find that EXACT house on another street for less.
People in the Adirondacks are mostly sticking with their prices because people will eventually buy them for what they are asking. I grew up in Essex County and my family still lives there so I have info on what is going on. Some of the little places are being 'discovered' since Gov. Pataki moved up there. Also, like you said, the house is paid off so if the kids are just paying taxes, it is likely they will keep it until someone pays their price.
Good luck on your home search, something great will work out for you!
Thanks. RE agents say everyone is selling their second homes, camps and land like crazy in the Adirondacks to raise cash. Except for lake front property its just like the rest of the country, only less buyers and people willing to wait. Four out of five sellers (whom we didn't offer to) were desperate and all homes were empty except for one who needed to move after being abandoned by her husband ... a sad state of affiars!
We drove by ex-Govenor Pataki's farm in the "historic" village of Essex several times and rejected a home about 2 miles from there in Willsboro because the main girder and supporting beams were ready to fall (but the asking price was astronomical). We looked from Tupper Lake, Saranac Lake in the West to Paul Smiths to Malone to Champlain and Plattsburgh and Westport and all points in between. The smaller northern villages along the Canadian border have homes that are are REALLY cheap ($65,000-100,000) and this home was in that zone ... my question is why hold onto a home that will be derilict and collapse in another winter? Better yet, why even list it if its not really for sale? We are seeing "Reduced for quick sale" everywhere and FSBO signs are like Stop signs in all the small towns ... Lake Placid is too expenive for all but the rich to buy in but everyone else is getting desperate -yet they appear to be having a sellers price revolt and the worst year is supposed to be next year.
Sounds to me like you wasted their time.
You cannot apply the general theme of "buyer's market" to all
real estate. Every situation and property is different.
If you want a house, make a serious offer.
Sounds to me like you wasted their time.
You cannot apply the general theme of "buyer's market" to all
real estate. Every situation and property is different.
If you want a house, make a serious offer.
Like buyers everywhere, the OP made an offer based on the condition of the home. If sellers made all of the repairs & updates perhaps buyers would be making offers closer to list.
I have yet to make a frivolous offer. Sellers still have the mentality that I am willing to finance their retirement, and I am not.
Sounds to me like you wasted their time.
You cannot apply the general theme of "buyer's market" to all
real estate. Every situation and property is different.
If you want a house, make a serious offer.
Well we had two Realtors telling these people (begging really) that this WAS a realistic offer and maybe their last chance for an offer. There are two other homes for sale on that street ... one of the same size asking $169,000 and one smaller but refinished asking $199,000 ... the second one was immaculate and the seller's realtor wanted this home reduced to near that price ($199,900) before listing. The sellers would not go below what they wanted it listed for and thats where the bidding started. Remember it would take $50,000 just to bring it up to code and make it inhabitable!
In fact our time, the people with the money to purchase the house, was wasted as they had no intention of selling. This place was on the Canadian border, near nothing and in poor condition. The market does have some fundamental rules and "if priced right it will sell" is one of them ... this one was not priced right and their lack of negotiation saved us from dealing with a property that would have been overpriced in any market.
Another truism is - when a buyer starts negotiating up in $10,000 increments and the difference of negotiation is $22,000, you don't walk away from the table. They were "playing" in the market believing its hot - its not.
We still have our $250,000 and are still serious buyers ... they have to find a buyer more serious than us to get their second offer in two years ... oh, did I mention the only major employer in the town went out of business and laid off 500 workers?? Not pretty.
But you don't need to read many threads on this board to get a sense of where sellers are coming from. They have an exalted sense of what their houses are worth, and anyone who has a different opinion is trying to "steal" from them.
It's pointless to try to reason with them. You just have to keep looking, and keep making offers, until you find someone who's reasonable.
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