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How are comps calculated? What if you are looking in an area where no houses have sold recently? The home sale prices are from 4 or 5 years ago (or even 1 year in this market) - so the prices are out of whack. How does the condition of the house play a role in determining the comp?
As you read through the up to the minute list below, you will see there are still sellers who expect to make huge six-figure profits in only a few years of home ownership.
But you have no idea how much work the owners put into the houses! They could have done major renovations that justify a higher price. I wouldn't assume they're all being greedy.
If there was remodel or renovations involved, have them THOROUGHLY checked out and inspected. I've seen carpet laid over carpet. I've seen double-drywall, meaning people just sheetrock right over the old stuff without making the necessary repairs. Decks and above-ground pools that are a nightmare. No permits for any of it.
Make that offer for 100K less if that's is what the house in its current condition is really worth to you. Comps are comps but they are also dated information. Your offer is an offer of right now, not what sold a month, three months, or six moths ago. Comps are yesterday's news and are way overrated IMO. This market of today is about what's happening today. A house is only worth what someone is willing to pay for it is the bottom line.
You're a fool if you offer at or near asking anywhere on LI. Who cares if you offend the sellers. It's business. No one should be taking offense to anything especially in this market including the people making the offer -- if their offer is declined with no counter, move on to the next house. There's plenty to choose from on LI. Don't get emotionally involved with any house you make an offer on. It's just a thing until it becomes your home.
Make sure you have your financing in order. You will need money down. The jumbo loan limit is $417K unless you can find a lender offering conventional at the new adjusted rates -- good luck with that. Just because there are new limits, doesn't mean there's a rush of lenders racing to offer them.
Lots of inventory and not a huge inventory of buyers in the $5-600K range. Buyer's market is an understatement.
How are comps calculated? What if you are looking in an area where no houses have sold recently? The home sale prices are from 4 or 5 years ago (or even 1 year in this market) - so the prices are out of whack. How does the condition of the house play a role in determining the comp?
I can see what you mean about comps being extremely dated in certain neighborhoods. I find comps hard to deal with because there are so many variables and because the timeframe from "offer accepted" to "sold" can be long in this area so looking at comps of recent sales gives you ideas about home values where the deals were actually made several months ago.
Here is a way to calculate a starting point as to what a house is worth. Find out the year the current seller bought it and the price they paid for it. Add 3-5% per year of ownership to the price they paid for it. If the house is in very bad shape, of course it will be worth less. If the house has had renovations, extensions, etc., of course it will be worth more. Here's an example:
But you have no idea how much work the owners put into the houses! They could have done major renovations that justify a higher price. I wouldn't assume they're all being greedy.
you offer a lot of good advice except that you should make your (lowball?) offer and move on, a house is just a thing. People vary and some have very precise requirements that aren't easily satisfied. IE myself, in modest price range, not luxury, but want to be near the water/beach, near shopping, will not tolerate recent renovations including disgusting pergo or laminate flooring, new cabinets in bathroom and kitchen which generally are made from pressed wood and plywood (made in China--and outgas toxic levels of formaldehyde for quite a while), a house that *needs* much renovation, a house without character, a house on properties where deer and thus ticks go, a house without a lot of sunlight, a house on a well trafficked street, a house that requires too much maintenance etc etc.
So it depends. For some people its an investment as their family grows and they plan to move on. Some are typical buyers and some are atypical. I'm atypical thus I have to hunt harder and longer and if I find something that falls into all my categories then I will bid what I feel will knock other bidders out.
Quote:
Originally Posted by alliswell
If there was remodel or renovations involved, have them THOROUGHLY checked out and inspected. I've seen carpet laid over carpet. I've seen double-drywall, meaning people just sheetrock right over the old stuff without making the necessary repairs. Decks and above-ground pools that are a nightmare. No permits for any of it.
Make that offer for 100K less if that's is what the house in its current condition is really worth to you. Comps are comps but they are also dated information. Your offer is an offer of right now, not what sold a month, three months, or six moths ago. Comps are yesterday's news and are way overrated IMO. This market of today is about what's happening today. A house is only worth what someone is willing to pay for it is the bottom line.
You're a fool if you offer at or near asking anywhere on LI. Who cares if you offend the sellers. It's business. No one should be taking offense to anything especially in this market including the people making the offer -- if their offer is declined with no counter, move on to the next house. There's plenty to choose from on LI. Don't get emotionally involved with any house you make an offer on. It's just a thing until it becomes your home.
Make sure you have your financing in order. You will need money down. The jumbo loan limit is $417K unless you can find a lender offering conventional at the new adjusted rates -- good luck with that. Just because there are new limits, doesn't mean there's a rush of lenders racing to offer them.
Lots of inventory and not a huge inventory of buyers in the $5-600K range. Buyer's market is an understatement.
I can see what you mean about comps being extremely dated in certain neighborhoods. I find comps hard to deal with because there are so many variables and because the timeframe from "offer accepted" to "sold" can be long in this area so looking at comps of recent sales gives you ideas about home values where the deals were actually made several months ago.
Here is a way to calculate a starting point as to what a house is worth. Find out the year the current seller bought it and the price they paid for it. Add 3-5% per year of ownership to the price they paid for it. If the house is in very bad shape, of course it will be worth less. If the house has had renovations, extensions, etc., of course it will be worth more. Here's an example:
I'm sorry, but this is laughable. We are talking about at $600,000 house.
Which $600,000 house do you mean? I am not talking about any specific house. It's solely a mathematical exercise based on a fictional house that sold in 1995 for $175K. What are you talking about? Propaganda for the Sheeple of the USA?
PS: Nothing is ABSOLUTELY POSITIVELY GUARANTEED to be a $600K house unless it SELLS for that. Surely YOU of all people should know that!
If there was remodel or renovations involved, have them THOROUGHLY checked out and inspected. I've seen carpet laid over carpet. I've seen double-drywall, meaning people just sheetrock right over the old stuff without making the necessary repairs. Decks and above-ground pools that are a nightmare. No permits for any of it.
Make that offer for 100K less if that's is what the house in its current condition is really worth to you. Comps are comps but they are also dated information. Your offer is an offer of right now, not what sold a month, three months, or six moths ago. Comps are yesterday's news and are way overrated IMO. This market of today is about what's happening today. A house is only worth what someone is willing to pay for it is the bottom line.
You're a fool if you offer at or near asking anywhere on LI. Who cares if you offend the sellers. It's business. No one should be taking offense to anything especially in this market including the people making the offer -- if their offer is declined with no counter, move on to the next house. There's plenty to choose from on LI. Don't get emotionally involved with any house you make an offer on. It's just a thing until it becomes your home.
Make sure you have your financing in order. You will need money down. The jumbo loan limit is $417K unless you can find a lender offering conventional at the new adjusted rates -- good luck with that. Just because there are new limits, doesn't mean there's a rush of lenders racing to offer them.
Lots of inventory and not a huge inventory of buyers in the $5-600K range. Buyer's market is an understatement.
FINALLY SOMEONE WITH SOLID GOOD REALISTIC INFORMATION AND ADVISE!!!
Which $600,000 house do you mean? I am not talking about any specific house. It's solely a mathematical exercise based on a fictional house that sold in 1995 for $175K. What are you talking about? Propaganda for the Sheeple of the USA?
PS: Nothing is ABSOLUTELY POSITIVELY GUARANTEED to be a $600K house unless it SELLS for that. Surely YOU of all people should know that!
I was referring to the orginal question asked in the thread. As usual, we end up way off base and not helping the person with the question.
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"a house is a thing"
