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If you go back and forth negotiating, a 4 in the first number of the final price might be a psychological boost for the seller. ($401k)
Don't let them know you need a ranch.
If this house doesn't work out, you could consider 2 story homes and evaluate the cost/possibility of adding an elevator for mobility. $20k range. Home elevators are getting more common these days and can be added after-the-fact.
I've already been through those numbers. Adding an elevator which can accommodate a scooter is extremely expensive for the elevator itself, not to mention the additional work required on the house. For my current center hall colonial .. with all the re-engineering I was looking at over $60,000 plus finish work just for the elevator. Then I'd have to redo at least the master bath, widen some hallways and reconfigure the kitchen to accommodate turning space. Then there's adding a generator, changing the exterior steps to ramps and tearing down the garage to rebuild it attached to the house. Finally, adding a first floor laundry.
This is the 5th house in two years I put an offer on. The other 4 fell out of contract because of contingencies. Primarily due to bad surveys. All the offers were within 6% of listing price....because they were priced correctly to market. And our market has gotten worse in the meantime.
So I just sit and wait. If this falls through, I'll have little choice but to build. I already have pricing for a 2800 sqft Craftsman ranch.. 3/2/2 plus den and screened in rear porch on .96 acre on cul de sac. Town water and sewer, natural gas, central air.....more millwork than I care to dust, high end kitchen and tiled baths, first floor laundry room. All the allowances for appliances exceed what I would select.. ditto for cabinetry,hardwood flooring, counters. $649,000. I just don't have the patience anymore. But if needs must.. as they say.
Even with a cash offer you should make an appraisal one of the contingencies.
You're in a tough spot because appraisers shouldn't use two-story homes you describe in the neighborhood as comps. One compares a ranch to a ranch and a two-story to a two-story.
Are the tax records available public information? Assessments for tax purposes are generally not a good way to determine price, but in this instance it "might" help. You might try comparing the tax assessments for the two sold properties to the sales prices to determine if there is a pattern. For example are the houses selling for "x" percent above/below tax assessments? It may give you an idea about this house.
How property is assessed for taxes varies tremendously from state to state. Many places claim they use market value, but how that market value is determined is important. How often are properties re-assessed is also important. Ask your agent how it's done in this area and how often. Those numbers may prove useful in this situation.
Even with a cash offer you should make an appraisal one of the contingencies.
You're in a tough spot because appraisers shouldn't use two-story homes you describe in the neighborhood as comps. One compares a ranch to a ranch and a two-story to a two-story.
Are the tax records available public information? Assessments for tax purposes are generally not a good way to determine price, but in this instance it "might" help. You might try comparing the tax assessments for the two sold properties to the sales prices to determine if there is a pattern. For example are the houses selling for "x" percent above/below tax assessments? It may give you an idea about this house.
How property is assessed for taxes varies tremendously from state to state. Many places claim they use market value, but how that market value is determined is important. How often are properties re-assessed is also important. Ask your agent how it's done in this area and how often. Those numbers may prove useful in this situation.
Our assessments are based on FMV. Cost to rebuild less depreciation plus land.
Yes, I looked at assessments as well. Community hasn't had a re-eval in 3 years so they are behind.....
The property is assessed at $434,000. Comp #1 in the subdivision which hadn't been updated since built and in similar condition to the property is assessed at 480,000. It sold for $440,000.....Comp #2 is assessed at $535,000 and updated, sold for $535,000.
There hasn't been a ranch house sale all year. In 2012 there was one ranch sale - an investment property 27 years old in dire condition sold for $179,000. It is currently for sale - lipstick slapped on a pig for $372,000... and it's been on the market for 7 months. FSBO. It hasn't had a reassessment.
The town next door has been under full re-eval this year. New tax notices are starting to be sent out. Friends I've spoken to are delighted with their new assessments as their taxes will be going down at least for one year, until the Town recalculates the tax rate for 2014. Avg drop in assessment of those I've spoken to is 27%!
Both communities are declining markets.
There are two spec homes (colonials naturally) for sale in the town in which I wish to buy. Both on the market now for 90 days and each received a 7% reduction in price yesterday.
As far as bank appraisal.........I've talked to a couple of local appraisers I've known for years..bottom line houses are not appraising well due to declining market.
I think you are trying your best to convince yourself that the house is worth what you want to pay for it. For starters it is on the outer edge which commands a premium based on the two comps your provided. Also, focus on the street in question not other streets. Two houses sold on the street within the last year. They have priced it in the ballpark of those two sales.
I think you are trying your best to convince yourself that the house is worth what you want to pay for it. For starters it is on the outer edge which commands a premium based on the two comps your provided. Also, focus on the street in question not other streets. Two houses sold on the street within the last year. They have priced it in the ballpark of those two sales.
I took the side of the street into consideration in my offer. House on same side of street came in at 184 sqft... and upgraded property. That lot is very deep with plenty of pool space and backyard for playing.
Based on offer of 393,000...and 2026 sf......I offered 193.9 sq ft if you want to look at it that way. (comps were 161 and 184) This particular lot is smaller than both comps.. and while wider (hence the long ranch)... is shallow. Backyard just meets zoning requirements for R30. There is a State protective easement of 10 ft deep along the back to protect the historic stone wall which borders the property.
Received counter of $480,000... as I had pretty much expected.
Local bank appraiser is now working on the numbers. I look at it as a good $400 spent. He's pretty much the go-to local when out of town appraisals come in too low.
Received counter of $480,000... as I had pretty much expected.
Local bank appraiser is now working on the numbers. I look at it as a good $400 spent. He's pretty much the go-to local when out of town appraisals come in too low.
It's done. It does serve to bolster the appropriateness of my offer, but is not good news for seller. Appraiser also pointed out that protective covenant is not listed on deed as it should be, but is listed on the subvision for the three lots affected. Lazy town, but it was in the disclosure so I knew.
We (my agent and I) did not tell the appraiser what I offered.
When I did tell him....he gave me that "what??" look.. then he figured out I didn't deduct for the needing a new roof (as he confirmed) nor bringing the laundry room up to code which I was planning on doing upon acceptance of offer and after the official inspection.
As what to do now, I'm a little undecided as a property I had looked at a year ago has finally woken up and smelled the coffee and reduced their price by $250,000 which has brought it into the realm of possibility.... though it does need some demolition work (horrible rotted sunroom) and the garage would need to be attached to the house some how.
I'm going to sleep on it as they say for another night.
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