First-timers, Overpriced house, Realtor playing games
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A house is only worth what it's worth to YOU. This house has issues that make it not your dream house. If it's been on the market for a year, it must not be anyone else's dream house either. It makes sense that you might be willing to take it if you can get it for a fair price, but if you THINK you're over-paying, you are.
No doubt the buyer is trying to get reimbursed for his very personal "improvements." It might happen, but no reason you have to be the one who pays him. As many others have said: offer what YOU think is fair and not a penny more. Even if he rejects your offer and won't negotiate, that doesn't mean you won't still get the house. After a couple of more months with no offers, he might re-think his position. My guess is he doesn't HAVE to sell the house, he just wants to.
And if you are planning to remodel the house to your taste, make sure you account for how much that will cost you in figuring out what you can afford to pay. If you've never done home remodeling before, be careful about your assumptions of what things cost.
Just tell the agent that you've given your offer and she is to submit it. You never give any information about how much you can pay to the listing agent.
The OP shouldn't be talking with the Listing Agent at all. All communication should be through the Buyer's Agent.
She's already contacted us to ask if this is our "highest and best" offer, without offering any more information. I said yes, I believe our price to be reasonable without any additional information, and that we would entertain a counteroffer from the SELLER
Saying that you would entertain a counteroffer pretty much negates the claim that this is your "highest and best" offer.
'Highest and best' has always struck me as rather odd. I doubt it will go over well if I approached a seller and asked for their 'lowest and best'.
I view an offer as simply that. Accept, reject, or counter. I am the free to do the same.
I get it that in a multiple offer situation this is a way for the seller to get one last round of increased offers out before making a choice. That makes a certain amount of sense. My impression is that requesting a highest and best, or implying that there are other offers out there, is simply a sales tactic designed to make the buyer rush.
When I purchased last year, every single house that I showed any reasonable interest in came back with the reply that 'we have other offers' or 'there has been a lot of interest, this one will be under contract any day now'. The implication was that I should make an offer quickly, and it better be high or I would miss out.
I purchased a short sale, so I had the misery of watching the local real estate market for 8 months. None of the houses with alleged pending offers sold immediately, several had price drops, a couple came off the market entirely. A few did sell fairly promptly for asking price +/-, but it seems that most of these highest and best, other offers, etc are mere sales puffery.
Trust your gut, no matter what the professionals are telling you. If your thinking is off and your offer is consistently too low, you'll need to make an adjustment but don't do so until absolutely necessary.
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As a first time shopper take the above words to heart. The house is only worth a certain $$$ to you. Your the one paying the mortgage/taxes/upkeep so only spend what you think its worth. You have to be comfortable with whatever you pay. If you cant "afford" to lose the house then pay more to decrease the odds.
Real estate is not a science no matter what anybody tells you. Throw in hefty amounts of emotion on all parties side, a lax realtor licensing/education system, huge financial commitments, commission based sales and complicated legal matters and its generally a mess.
Also ignore list price. Offering 10% under list price does not matter if its overpriced by 25% You need to determine actual value. Sometimes appraisals don't even help with that (some are more accurate than others, and all have a margin of error). Some realtors focus on making the sale and not just focused on getting a fair and accurate price for the property. If you consistently offer to low then nobody gets paid. The whole system is stacked against you getting a good deal unless you have someone you really trust.
So take your time, analyze your market and really learn all the steps before making a huge commitment. Keep asking questions on here.
Last year we purchased a bank reo in unique circumstances and it was easy because it was just offer/counter/offer. We just added firm to our final transaction offer and had it accepted. Everyone was surprised it went through other than us. Since it was a local bank it went like a actual business transaction with no emotion or screwyness (unlike big banks who have tons of ulterior motives)
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