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Old 09-24-2010, 11:03 PM
 
Location: Sun City Center, FL
177 posts, read 682,994 times
Reputation: 142

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We are planning on buying a house in a specific Florida retirement community next year. We have visited the area many times (while snowbirding) and have been studying both houses for sale and houses sold during the last two years. We have made visits to about a dozen houses for sale during open houses.

Here is the question -- we have noticed that this year sometimes buyers have been able to purchase homes at a price 10 to 15% (I have seen as high as 30%) lower than the seller's last ask price (according to the MLS). These homes have typically been on the market for 6 or more months and the seller has already reduced their listing price once or twice. (Our price range will be between $130k to $200k.)

What are the suggested ways to approach the seller with a price this much lower than their asking price? (Not sure if 10 to 15% is a low ball offer.)

We moved many times in the past due to transfers. In 1995, we made an offer $35,000 lower than the listed price (they asked $300,000) and told the seller that this was our final and only offer. They accepted it within a few hours. So that was one way that worked for us once.

Other times, we decided the max we would pay for the house and offered less than the amount (but not twice the difference we desired). If they would sell for less than our max, we would buy; otherwise we moved on to another home on our "list".

In the past, we have always been in a rush to purchase because we were on our 4 or 5 day house hunting trip and we needed to buy a house right away so I could get on with my business life and be productive right away.

This time we plan to put our things in storage and stay in temporary housing until we find the right home at the right price.

Suggestions on how to approach a seller (through the agent) with the desire to purchase the home 15% less than listed? Or maybe you could point me to a thread already here.
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Old 09-25-2010, 06:39 AM
 
Location: NJ
17,574 posts, read 45,968,514 times
Reputation: 16266
You can't just come up with a % before you do the analysis and see what the market value is. House A could be 20% above market value and house B might be priced 5% below market value for a quick sale. Would you offer both the same % off asking price?
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Old 09-25-2010, 07:42 AM
 
14 posts, read 37,170 times
Reputation: 15
John T. Reed writes a book about purchasing properety 20% or more under value (not just list price). I haven't read that specific book, but I have read 3 of his books and a bunch of his website and he is ful of common sense. He self publishes, so you have to order from his website. I'm not certain if I can link here, but you could google it.

Typically to get that kind of a discount, there is something more to it than shrewd negotiations. Distress, either financial or with the house is involved. Best of luck to you.
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Old 09-25-2010, 07:42 AM
 
Location: Austin Texas
434 posts, read 1,305,001 times
Reputation: 159
Percentage isn't a good way to go about basing value. One house may be priced for a quick sale on one street and one block away a seller may be asking "30%" over market. If you offered 20% less than asking on the overpriced house you'd still be paying too much. Have your Realtor perform a CMA on a couple of houses you're most interested in only going back 6 months if there are enough comps out there, 24 months is too far. Things have changed in real estate since 1995, negotiating...not so much. What has changed is education, buyers and sellers have so much more information than before. So do lenders, realtors, inspectors, taxing authorities etc.
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Old 09-25-2010, 10:40 AM
 
Location: Central Texas
20,958 posts, read 45,166,931 times
Reputation: 24736
The question you're asking, as folks here have already said, isn't pertinent until you are looking at a particular house in a particular market, and whether that house is priced fairly for the market or not. If the house you want is already priced below the market, your chances are a lot slimmer of getting your target percentage off than if the house is already priced above the market.

It sounds like what you're wanting to buy is not a house, but a percentage.
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Old 09-25-2010, 12:02 PM
 
Location: Kailua Kona, HI
3,199 posts, read 13,341,529 times
Reputation: 3420
Whatever you offer, be sure that it is subject to an appraisal coming in at or above the purchase price, whether you are getting a mortgage or not. I have seem some pretty funky appraisals lately, and heard the same from a lot of others in the industry.

Settle on an agent that you like, review the comps and go from there. Best wishes.
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