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It's a homeowner (a couple) and they don't owe anything (I don't think). Got two mortgages, one at the time of purchase and another 6 months later (for some renovations, I'm guessing). Don't know how to find out the amounts, but they were both released the following year, and I found no other encumbrances.
They bought in 2004 for $612K and I think did some major renovations. Don't know how much they invested total. THe only addition to the property was made in 1979 (according to the assessor's records), so I don't think they added space, just interior finishes. The kitchen, baths, floors, etc. all seem fairly new. Brand new appliances and fixtures, stuff like that.
The property is assessed at 870K, and the taxes rose substantially in 2005 and again in 2006 (but not from 2002-2004, or after 2006). I think that must have been the result of the renovations the current owners did after they purchased in 5/04.
They also owned another property on the island and sold that one too. I think it was a condo. They live in the San Francisco area. I don't know why they are selling their Hawaii property now... it seems a bit mysterious to me. In this market, I would think people would have to be desperate for some reason (needing to move, a large expense, ???) to put property on the market.
You see, part of the problem is communication - my sister is dealing directly with the agent in Hawaii, while the rest of us buyers are 6,000 miles away in NY.
Thank you for the honest assessment of the situation. Given the financing is coming from a group of people, perhaps relatives, do you think it is in everyone's best interest to be on the same page, at the same time?
The agent can arrange a conference call and connect everyone involved and get the cards on the table. Relying on any single member when all have skin in the game can get confusing and hurt relationships.
Your best bet is to get your agent to do a CMA for you to get a good feel as to what the true market value is. If the comps are good, and they support a price at or lower than 900K, that's the best bet you have for getting it for within your price range desire. Think about possibly showing the sellers the other homes you consider comparable, and what they are asking (if this supports your price argument of course)
If the CMA shows 900K would be a great deal, By all means put in your final and best offer at 900K and hope the seller see's the motivation to sell now, virtually guaranteed, will outweigh the risk of never selling, or selling later for even less.
Sometimes your realtor can simply ask the listing agent what he thinks the lowest number the seller will accept is. Technically the listing agent can't give you an answer, but you'd be surprised what some agents will do unknowingly; to the detriment of their clients. You can also ask them to reveil if there were any previous offers that may have been turned down and how long ago they were. Again the listing agent can only reveil if there were previous offers, but cannot tell what they were without seller permission.
We did get a list of homes sold in the area, listing/selling prices, DOM, etc. We sort of had to do our own figuring of what was comparable, based on square footage (house and land), BR/BA, etc. There is really nothing truly comparable.
We have asked "our" agent and are getting no help with negotiating strategy. We asked directly what she would recommend offering, and she responded that "the chance of getting it for 900K is 50/50, for less than that, 25/75; I'll write it up however you want." Ugh. No help at all with respect to what we should offer. Now, for that I fault my sister, for refusing to be more insisting, but you can't get blood out of a turnip. (upon rereading this, it seems that I was referring to the agent as the turnip; not so - I meant I can't change my sister into something she's not, make her act how I wish she would)
I did a bunch of PI on the seller (via the internet - Google is great for that), I'm still not sure exactly what her motivation is but I have some ideas. Anyone selling in this market must be strongly motivated, I figure. We also have a better idea of what she probably put into the place, and we now know what she was renting it for. So now we're pretty sure she will have a nice return on investment if we end up paying $900K.
So we offered $870K. We're all too chicken, right now, to do the "final offer" thing (not sure why), but probably will do that next round. Also, we don't want to go HIGHER than we have to; once we see how far down she comes we'll have a better idea of where she might be willing to go. I don't know, that's why I'm asking you all. I'll keep you posted.
Last edited by Sweetbeet; 01-31-2008 at 03:24 PM..
Reason: clarify "turnip" reference
Don't go any higher and put a 48 hr expiration date on the offer. If they don't take it, make an offer lower than the current one. Like dmensha said, start looking at other homes.
Make them cave. Their still going to make a disgusting profit. Hope you don't mind that.
Who is purchasing the home -- you or your sister? If it's your sister, then she needs to be the one dealing directly with your agent. If it is you, then you need to take advantage of cell phones with unlimited long distance, e-mail, etc. and have your agent be accountable to you. You may find that you are far more satisfied with the process if you have direct communication with your agent.
My sister, mother, husband and I are all going to share ownership (this is a multi-family dwelling). So we have our own interpersonal issues on top of all the rest.
I think things are going well. Sure, the seller is going to make a profit. Everyone who buys property in Hawaii makes an obscene profit, pretty much.
I like the advice to put a time limit on the offer. And then offer lower. THAT is what I wanted, some tough advice from all you tough people out there.
We have started looking at other homes. My sister is looking at two more today. Between us, there really aren't very many that will suit our family's needs, are in the right area, have a decent amount of land, and are within our price range. (But we're not telling anyone that, although it must be obvious to our agent.)
Sweetbeet, no pun intended, but why cant you talk or email or communicate your thoughts to the agent, instead of relying on your stressed out sis? With the telecommunications and such we have, I would talk direct to the agent. Negotiations are a means to accomplish a give by both sides, and once you find out what they owe, and you know what you want to pay, then I agree, make your best and final and see what happens.
1) You're spending $900K on a house. I hope you've seen it. If not, fly out and meet with your agent and take a look at the property, plus the next best ones available. This will help you feel more confident in where your level of motivation should be.
2) I think it's a mistake and a distraction to invest so much time and energy trying to investigate a seller. In fact, I think it's creepy.
Whenever one of my buyers or sellers starts doing that, I redirect them back to the fact that we simply need to decide what the number is going to be, and the offer will either be accepted, rejected or counter-offered.
All this crap about when someone bought, how much the owe, why they might be selling, etc. is just useless mental masturbation. Knowing all of that won't change by even one penny what the seller's bottom number is.
I've bought and sold 7 personal properties myself in the past 12 months. I never have and never will look up anything on anybody I'm dealing with because I know it doesn't make a bit of difference. I'm going to have bottom or top dollar irrespective of anything I may or may not know about a buyer or seller.
3) I disagree with going to your top dollar on round two. Your next counter-offer should be determined by your level of motivation, or lack thereof, and nothing else.
If you won't be terribly disappointed to lose this deal, you'll negotiate tougher. If you feel good about the house and think $900K is a fair price, you'll come back closer to that number.
4) It's not your agent's job to tell you a specific number for your counter-offer. The agent should be providing data and insight, but your level of motivation determines your counter-offer, not the agent's opinion.
I hope this helps.
steve
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