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Another Damned House purchasing question......(9 posts)

Another Damned House purchasing question......CARBON110
Dec 17, 2003 9:39 AM
Im looking at this house and they are asking faaar more then what its worth but the market here is OUTTA CONTROL!

Had to get that out, anyhoo, I really like this house so now Im trying to see what/why they are asking what they are. Its post and beam but they put "southern pine" floors in. Now correct me if Im wrong but arent Southern pine floors extreemly SOFT and CHEAP???? I could understand the price of the house if the floors were say Cherry oak or something. However the rest of the house is TOP OF THE LINE and I mean tip topon everything.

Also, the agents son in law built the house and its not quite finished, the ground floor needs some finishing work. Is that a bad thing in my favor? For every hundred thousand the house cost how much should I start my offer at?? Meaning if the house costs say 400K should I begin offereing at 350? How much do you low ball?

Gracias mi amigos and send me the bill for your advice :P
re: Another Damned House purchasing question......Duane Gran
Dec 17, 2003 9:54 AM
The first rule of negotiation is to always be prepared to walk away, even if you really want it. Your only power in this situation is your ability to purchase elsewhere. If the other side thinks this is your only purchase decision they will push you around.

I recommend talking with your realtor about other homes and possibly even put in an offer on another place. Most offer agreements are contingent on a subjective factor, like the homeowner's association rules. If you need to back out on one offer, just exclaim disbelief that they won't let you have a pig farm in the back yard. ;)

Start to offer low. The worst they can say is no. Pick the upper limit in your head (don't ever tell it to the realtor) and give yourself some padding. For example, if 375 is the limit, offer 350 and do your best to keep it under your threshold. If it goes over, walk away (or at least hint that you are ready to walk).
I wouldn't do that.....Tri_Rich
Dec 17, 2003 9:58 AM
In NC at least, offers are accompanied by earnest money, and if accepted represent a contract. Backing out will at least cost you the earnest money, and it's your responsibility to know about things like restrictive covenants.
good pointDuane Gran
Dec 18, 2003 8:16 AM
You bring up a good point about knowing the local laws. In Virginia it is much simpler to back out of an offer. I would say it is a good idea to make it known that you are willing to look at other houses nonetheless.
re: Another Damned House purchasing question......No_sprint
Dec 17, 2003 10:00 AM
The above advice is good. Be prepared to walk away. It aint the only house around.

Here in SoCal, a typical house sale goes something like this: The house is on the market on Dec. 1, later that day a prospective buyer calls the realtor, offers $25K more than the asking price, without even seeing the place, the realtor responds by informing the prospective buyer the house sold that morning to another caller who hasn't seen the place and offered $40K more than the asking price.

That's how it goes here, your area probably differs.
I would seriously recommend getting an agent....Tri_Rich
Dec 17, 2003 10:05 AM
You will not pay more with an agent than without, and especially when there is anything unusual like part of the house being unfinished it would behoove you to have someone with knowledge and connections working for you.

As to the asking price, you need to know the market in your area. Different areas have different norms. There are areas in this country where the offer is expected to be more than the list and others where the list is 2X a reasonable offer.

(My wife is a former realtor and currently does appraisals)
Location, Location, LOCATION!53T
Dec 18, 2003 8:46 AM
Lift your head up and stop focusing on the floors. You are buying real estate, not lumber. If there is something in teh house you don;t like, just translate it into a dollar adjustment. If you don;t like the floors on the first level, that's about $7000 to change, for example.

On a $400,000 house this $7000 is about the difference in appreciation over 5 years of about 0.35% per year. The location of the house can affect appreciation much more than that. Hell, random forces can affect the appreciation by about 5X that number.

Your question: Where to start bidding, I would not hesitate to put in a 350K offer on a 400K listing. But I would not delay, the early bird get all the worms.
As usual, good advice from 53T. I'd add one more thing..eyebob
Dec 18, 2003 11:06 AM
get a freakin agent. A good one will do all of the work for you. They'll do a market analysis and tell you exactly why something is priced where it is. You will save money, trust me. Studies on this type of thing report that even house sellers (that are not agents) who list "For Sale By Owner" end up losing money in the long run cause buyers are saavy and will reduce offers knowing that (like me).

yup...what he said...get an agent (nm)ColnagoFE
Dec 18, 2003 12:54 PM