Bidding on a house... Need advice! (appraisal, foreclosure, accept, housing)

[JenM]

Ok here's the short version: I live in Michigan where the housing market is extremely depressed to say the least. Today we are going with our realtor to the view the home of our dreams!!! Yay! Anyway, the house is in foreclosure and in need of work. That's not the problem. There are 2 other offers on the table already and they are just waiting for us to put an offer in to make their decision. My husband and I want to bid the full amount ($119,000). THe home is worth $170,000. I am afraid that if we don't bid higher then the asking price, we won't get the home. However, the market, as I said before, is very depressed. From your experience, is it better to overbid in this kind of situation or offer the asking price??? I really really want this home! Help!

[Apple Annie]

Give it your absolutely TOP bid and don't worry about the housing market. If you are going to improve the property to live in it and love it long term, then in the long run, appreciation is what you should look at. Real estate markets are cyclical at best, so don't try to time the market; leave that to the investors. It sounds like you have not seen the interior yet, however. So be prepared to be disappointed, maybe it needs more work than you think. That is your judgment call as to whether you need to do it all at once, or if you can do it little by little.

Go over asking price by at least 6%, with an odd number, so you can have an edge.

You will always get your money back in a mint condition well kept attractive home with curb appeal, especially if it has the Big L. Location.

[BrianG]

I agree with annie

if you get is at your bid price you are
still getting a bargain if what you say is true about the value
It is not like dealing with another realtor
say i bid 119m and there is another offer out there
they will either come back to me with a counter offer or tell me the other over the have is higher (they can't tell you how much) and give me the option of upping my offer or calling it a day

good luck and i hope you do get it

[sablebaby]

We had bidding wars out in Phx for a long time. It was so annoying and stressful! Most bids were way over listing. No one knew what the others bidded so you gambled by coming up with a figure. If you really want this house bid as much as you feel comfortable. Also there are other things that are considered in an offer, like time of close, closing costs, etc. Make it all look good for them to accept yours. Good luck!

[sunsprit]

Is the house worth $50,000 more than the "listed" price in it's current condition needing work?

Or is that the FMV in today's market if it's in market ready shape after repairs?

I doubt that somebody's selling a good house in a foreclosure situation so far back of the market. Sellers may have a time/financial issue to deal with, but something's not quite right about walking away from that much money.

These are the situations where investors will be swimming around like sharks looking to make some money. (I know ... I'm one of them in my local marketplace). IF this deal was so good, then there'd be more than 2 other bidders out there ....

Be careful about how big a refurbishing job you take on. In some cases, it can be more trouble than it's worth, especially if you need to bring in specialty contractors for much of the work and are trying to make the place your home at the same time.

[Apple Annie]

There are many reasons for foreclosures as you know. Death, no estate, no relatives. Divorce, similar to death. Over leveraged, refinanced to the teeth. Loss of job most likely in a market such as this part of MI. Not many people choose foreclosure, it's a happening.

I wondered also where the "worth" $170,000 figure came from. Maybe it was the bank appraisal. It will all be disclosed to the buyers, I wouldn't be concerned about that.

Any house from the standpoint of someone who is going to live in it (not flip it), is worth what a willing and able buyer will pay.

Let's see how these folks do, always interesting.

[BrianG]

Originally Posted by Apple Annie

There are many reasons for foreclosures as you know. Death, no estate, no relatives. Divorce, similar to death. Over leveraged, refinanced to the teeth. Loss of job most likely in a market such as this part of MI. Not many people choose foreclosure, it's a happening.

I wondered also where the "worth" $170,000 figure came from. Maybe it was the bank appraisal. It will all be disclosed to the buyers, I wouldn't be concerned about that.

Any house from the standpoint of someone who is going to live in it (not flip it), is worth what a willing and able buyer will pay.

Let's see how these folks do, always interesting.

right again
and
Please let us know how you make out

[JenM]

Thank you for your responses! Unfortunately after viewing the home we decided it was not for us. Even though the structure is beautiful, the house needs work! Our realtor said it was a "forced foreclosure" and the previous owners did some damage. They ripped out the furnace and A/C, punched holes in the walls, tore out the carpet, tore out the light fixtures. They also let their animals deficate and urinate all over the walls, wood floors and closets! The was vomit and some other unknown, smelly substance in the basement and master bedroom. THe ceilings had water damage from who knows what and they ripped out heating ducts from within the walls. It would be a beautiful home if we had the money needed to fix it up, but we'd be really over-extending ourselves if we did.

On a positive note, we found another home. Although it is quite a bit older, it has almost 3,000 s.f., is completely remodeled and at the bottom of our price range!!!

[BrianG]

Originally Posted by JenM

Thank you for your responses! Unfortunately after viewing the home we decided it was not for us. Even though the structure is beautiful, the house needs work! Our realtor said it was a "forced foreclosure" and the previous owners did some damage. They ripped out the furnace and A/C, punched holes in the walls, tore out the carpet, tore out the light fixtures. They also let their animals deficate and urinate all over the walls, wood floors and closets! The was vomit and some other unknown, smelly substance in the basement and master bedroom. THe ceilings had water damage from who knows what and they ripped out heating ducts from within the walls. It would be a beautiful home if we had the money needed to fix it up, but we'd be really over-extending ourselves if we did.

On a positive note, we found another home. Although it is quite a bit older, it has almost 3,000 s.f., is completely remodeled and at the bottom of our price range!!!

It sounds like it turned out to be a good thing you did not get the first one
it sounds like you found something better and no work needed

OH YEAH
somethings get better with age , just look at me

[Pixie Dust]

I actually think that older homes have more character and are better built. I could care less for a new construction. just my opinion.