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How much under a house's listed price is a good offer?
I'm helping a friend search for a house in the northeast part of SA. I'll search several sites, google address to find other listings for same house in zillow, movoto, etc to get a good idea at how much this house was initially listed and see if there have been any price changes. I'll also search under SA Almanac and BCAD to get idea of assessed value. I know the listed price is what the seller "wants" but not necessarily what the house is worth. Is it safe to offer a certain percentage under the listed price? My friends realtor is not very helpful, doesn't provide much guidance. Her agreement with said realtor is still good for another couple of months. I told her she needs to find another one that will "mix it up" with a seller and advocate for a better price. My friend is not considering any houses even a thousand dollars beyond her approval loan. I told her if she wants a house bad enough, her realtor needs to put on her "pit bull hat" and fight for it. Am I wrong?? Seeking feedback from experienced buyers.....Thanks....A Renter
When we moved here in '02 and the market was heating up, I put in an offer 10% and many thousands below the asking price on a home I thought was overpriced that had been on the market 9 months. The response it received made it seem like that offer included personal insults aimed at the seller's parents. Our agent acted like she was ashamed to turn in the offer and the seller never countered or acknowledged it. We found a much better deal a week later.
I wouldn't hesitate to do something like that again if I were buying in today's market. Sellers need buyers more than ever.
Buyers market here. Some people are desperate to sell their houses and most will consider any offer. I just bought a house that was listed at 134,900, two months later the owner dropped it to 124,900...I offered 118,000 and the seller pay 2000 in closing and they took it. Offer what you feel is fair...your friend may be surprised! What is the worst that could happen? They say No....
Your friend needs to FIRE that Realtor and fast! It sounds like YOU are doing all the work that the Realtor should be doing. And honestly, while the resources you are checking are helpful, they are typically not 100% accurate. The MLS system (that only those who subscribe to it can access - Realtors), is what is needed to find ACTUAL sold prices/price changes/days on market, etc.
Have your friend talk to the current Realtor and explain that she is not happy with the service received and wants out of the Buyer's Rep Agreement. If she does not get the answer she wants (and honestly ~ NEEDS), go to the agent's broker. They don't want lawsuits on their hands for an agent who is not doing their job and representing the client fully. It is TOTALLY possible to get out of the contract with that Realtor.
There are PLENTY of competent, hard working Realtors out there who will do their job correctly, someone who isn't working for their client does NOT deserve to be paid. AND, being a buyer's market right now, why not be represented by someone who will negotiate well?
I have to agree. When we purchased in 2005, we put in an offer for a home that was 6% under the asking price (asking 160, offered 150) and it was way overpriced for what it was. Our realtor said the owners were from California (we had recently moved back from Cali) and were shocked that we would even think of offering under the asking price. We tried to negotiate but they would not nudge one dollar so we happily moved along and found a much better house for 145! So... I guess it all depends... you're not looking to make friends, you're looking to buy a home, right? While I don't think it's right to take advantage, it's also in your best interest to do your homework in comparables and make a fair offer. A realtor is very valuable in this specific part of the process. Regardless, if they decline and don't counter-offer, then maybe it just isn't meant to be.
By the way...you are a GREAT friend for doing so much background checking for your friend!
Everything must be taken into account when bidding on a house. What does the house look like? Fixer-up? Pristine? Neighborhood desirability? How anxious are the sellers to get the place sold? I'd say, unless the house is an absolute wreck, and fixing it up is worth it, then make a low-ball offer, without worrying about insulting the owners. The owners can counter offer, and let the games begin. But if the house is in good shape, in a down market, I'd say to make an acceptable offer, with the assumption that the owners will negotiate a bit, but not a lot.
Also, if your friend has her financing completely approved, that's a huge plus. I refused to accept offers from people who were not pre-approved, when I sold my last house. Also, she can be flexible in terms of her move-in date, or if the owners want to rent back the house.
When we moved to SA in 2005, we bid on a house here which had been on the market for six months. We put in a low-ball bid, and were turned down. Then we put in a full offer bid, and suddenly...after six months...the house had "just" sold to someone else. We don't know what really happened, but the realtors we had--who were incredible!--said that there was something strange going on behind the scenes.
From what you wrote, I'd say your friend should get a new realtor, who will actually work on her behalf. And tell your friend that there is always another house, always another deal.
Her agent should be able to tell her what similar houses have sold for in that area in the last couple of months. If she won't provide that info then I agree totally with Jules. Keep in mind that this is generally a slow time for real estate anyway...so your seller may know that and be holding out a bit longer for the "buying season" to warm up....generally March and April in this area. At any rate, get the "sold" comps and tell her to offer what's reasonable.
BTW - Zillow and other sites are notoriously incorrect.....and with the market fluctuating so much, the figures are more likely REALLY off. Actually "sold" comps for recent sales should be her best measuring guide.
I see great advice coming into this thread, and I, too, would suggest that you dismiss your realtor. While it's true that even buyers' agents really work for the person who pays them (the seller), you should be able to find one that will negotiate for you. You can get out of that agreement immediately. As a prospective buyer, I will have to release my agent as well for general timeliness of correspondence issues. More importantly, however, and as is your case, this person is not assertively price-conscious. When I did see a place that I liked a year ago that was priced higher than I thought it was worth (at 195,000), I asked this realtor if it was a good price, and she/he assured me that it was, that this was the going price for the area, and that I shouldn't bother to come in lower. When the realtor pulled the "sold" price for this house a few months later, I was shocked to see it sell for 175,000--well within what I would have considered a fair price at the time (today is another story!!). Anyway, please consider my experience as being evidence that you need to find a realtor who will come to the table with a pair of ____ or the female equivalent.
Good realtor's will take whatever you offer without any hesitation! If they don't, they are looking out for themselves....they want to make as much as possible with the slow market. You offer what you think is fair....if the agent is reputable, they will take all your offers no matter what.
I'm buying new, but if I was buying pre-owned I would offer between 10-20% below the asking price.
When I was looking around, the prices seemed kind of high for a buyers market. So I think the owners set the price a little high knowing that they will get a low offer.
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