Low Balling Builders (price, offer, good)

[BF66389]

I would go with the fair value of the home. You can also make your offer look better to the builder by asking for upgrades or cash @ closing instead of a reduction in the actual sales price. A friend of mine got a great deal on a brand new condo because they didn't ask for a reduction in the selling price, instead they asked for a bunch of upgrades as well as cash @ closing. A win for the builder because the home was listed as "sold" at the asking price (didn't drive down the selling price of other condos in the complex) and a win for them because they got more for less. Granted their offer was also fair based on the market.

[rmcewan]

Ok - what? Low balling is highly insulting? Everything is negotiable. Supply and demand. The seller can walk away just as easily as the buyer. You're buying a property, not robbing the fellow. Look, who would blink at offering $17K for a car with a $20K MSRP? You would be CRAZY not to. Nobody pays MSRP for cars, because cars generally never have a supply problem. In a property market with almost no demand, a buyer would be crazy not to deal aggressively. The builder can always wait for the next buyer to come along. Never feel guilty for getting a good deal.

[BF66389]

Originally Posted by rmcewan

In a property market with almost no demand, a buyer would be crazy not to deal aggressively. Never feel guilty for getting a good deal.

Agree, the key is to arrange the deal so that you get the highest chance of getting what you want at the price you are willing to pay for it.

It's one thing to offer an arbitrarily low number, another to offer a fair number that happens to be lower.

[buck naked]

Originally Posted by rmcewan

Ok - what? Low balling is highly insulting? Everything is negotiable. Supply and demand. The seller can walk away just as easily as the buyer. You're buying a property, not robbing the fellow. Look, who would blink at offering $17K for a car with a $20K MSRP? You would be CRAZY not to. Nobody pays MSRP for cars, because cars generally never have a supply problem. In a property market with almost no demand, a buyer would be crazy not to deal aggressively. The builder can always wait for the next buyer to come along. Never feel guilty for getting a good deal.

I wouldn't expect to have a salesman agree to drop the car price 25% and neither should a house buyer. Offering $150K for newly built house listed for $200K is insulting. True, the buyer doesn't have to take the offer, and he won't. Just don't expect him to continue listening. I live in the mountains near Lake Winnipesaukee. The homes are selling nearly as quickly as they are listed and new homes are generally sold before they are even built.

You might be lucky and be taken serious. If I was the builder, though, I wouldn't even look at your name if there was a second offer.

[GregW]

Given the current prices why build a new house. I suggest buying an existing house and getting a 300K house for your 180K.

[sjwaste]

Around here, public MLS data includes seller subsidy, so the effective sales price is reported. Is that not the case in NH?

If you get cash at closing here, it's very easy to see when you look at the comps.

[twinmum]

I agree with Buck Naked and have to add...
I have experience with only a couple of builders here in the Seacoast area, and in my experience they would rather sit on the house for a year than consider a lowball offer. I am all for negotiating a great deal but at some point you have to consider whether or not you are trying to get something for nothing. I would be offended if someone was asking me to lower my price 25% in a market where the homes that are selling are doing so at about 95% of the listed price.

[kiggy]

So are you saying that the housing market in NH has already rebounded? That's not what I'm seeing -- I'm seeing houses sit in Southern NH. I don't think many builders in this market would feel "insulted" by any offer at this stage of the game. With builders going bankrupt everywhere around the country, and so many properties glutting the market, I think the days of builders being insulted are gone, and for a long time.

[buck naked]

the only houses 'sitting' in this market are the homes that are over priced, homes that are listed for over a 1/2 million and are in the 3/4 million range - a home listed at $200K anywhere in NH is probably NOT overpriced.

What a buyer has to consider is that the builder has already taken into account the market and fair market value. If there is a realtor involved in marketing the property, then you can be sure the property is listed at a fair price. Building supplies and materials have skyrocketed in price, and it's difficult to make a profit compared to just 6 years ago.

If you have found a home at $200K that you like, then offer $185K if you MUST dicker and go from there.

[Synergy1]

If as a builder I had 200k in a home and my homne was l isted at 296k then someone gave me a bid with a deposit in writing for 240k I woud try for 280k. If not then I would put the home on the market as a rental and build my next home....The larger the builder the more unflexible the builder was to lower his price. I built 5 a year and if I could make 40-50k from a home that cost me 200k and listed at 296k I would take the offer but put up a legitimate argument.

Some customers would want me to take 260k for a 296k home and want me to pay their closing costs. I always said no because it was the principle to me. Offer 260k straight up and I will try to get more but if not then I would add a stainless frig, washer and dryer to entice you to accept my 260k.