offering below asking

in today's market, how low do you offer on an asking price?

do REA list homes higher than they hope to get knowing that buyers will offer under asking and look to negotiate?

if a seller is asking $520k and it doesnt seem WAY off, what would you offer?

we love this house but our roof is 500k. we would LOVE to get it for 475-480 if possible. is that unrealistic for this market?

it doesnt help us that the house was just listed last week

Re: offering below asking

Obviously, there is no "one size fits all" approach that determines how much you should offer. It really depends on what you believe the value of the home is and what your budget is.

You asked whether real estate agents price properties too high in order to leave room for negotiation. It's hard to generalize, but I can tell you in my case, I prefer not to do that. I would much rather price it at market value and get a lot of buyers through the door to increase the chance of getting an offer. If a house is priced too high, you run the risk of not getting anyone to even look at the property. There are a lot of homes for sale on the market now, so it's important to be priced competitively (at least in line with comparable homes). Buyers have a lot of options, so agents want to make sure they will look at their lstings (even though there may be plenty of comparable homes on the market).

That being said, while real estate agents counsel sellers on the market value of their home and provide information on comparables, the SELLER is the one that ultimately decides the asking price. And the pricing is closely tied to a seller's motivation (which you usually don't know). If sellers need to sell quickly (because they are being transferred, for example), they wiill probably price the house aggressively and entertain all offers in order to achieve a quick sale. But other times, a seller is just testing the market and doesn't need to sell, but will sell if they can "get their price." Some sellers will be insulted by a low offer and not even make a counter, but a motivated seller will usually be willing to negotiate. You are right that it's a little tougher when a home just comes on the market, because the seller may believe that better offers will come along if they wait.

In your case, I would make your offer (I don't know the house, but I don't think you are coming in very low -- offering in the high 400s seems realistic, at least as a starting point) and expect a counteroffer. If you are concerned that the house is priced too high for the market, the best way to check that is to look at "sold comparables." In other words, if the house is a Colonial, look to see what other Colonials in the area (same school district and neighborhood) that are roughly the same size/same lot size have sold for in the last 3-4 months and see if the list price of the house you are looking at is in line with the rest of the market. If you are working with a buyer's agent, they will pull comps for you before you make an offer anyway.

But you really don't have anything to lose by making an offer and seeing if you can get the house for a price fits you budget. You never know the seller's situation, so it doesn't hurt to try!

Good luck!
Christine

Re: offering below asking

Don't think that just because it's only listed for a week that it will backfire. Our house was on the market for a week, and our sellers accepted our offer, 20k less than asking. So it can happen!

The worst that can happen is that you offer 480, and they come up to 500k or say no. But you won't know until you offer! Good luck!

Re: offering below asking

It doesn't hurt to try, worse comes to worse they will counter.

Also, you don't know ther situation maybe they want out quickly and are willing to go below asking.

Good Luck Karin!

Re: offering below asking

Good luck - like pp said - they can always counter.

Do you have any recent comps for the area?

Re: offering below asking

thansk everyone!! i do have the recent comps and i think it is fairly priced (we havent seen it in person yet, going this weekend)...

ahhh, i hope it is as great as it looks in pictures and on paper and that everything works in our favor

Re: offering below asking

There is no harm in offering what you think it is worth or you want to be your ceiling
They can always come back with a counter
Just a piece of advice - I offered 100k below asking price (I did buy at the low of the market though)
They countered and I backed off bc I didn't want to go above a certain amount for this house
Thought we lost the house and moved on - 3 weeks later they came back and countered with 70k below asking price - we accepted - you never know what people are going to do or why they need to sell - mine had 2 mortgages and really need to get out of this house
My sister offered 100k below asking at the height of the market and the people accepted bc they were moving and needed to get out
Good Luck

Re: offering below asking

We are selling our house now and are open to hearing all offers. You never know what their situation is.

Are you ready to buy now? Nothing to sell? Are you pre-approved? These are all things I would take into consideration when thinking about an offer we get.

Re: offering below asking

Sometimes the sellers won't counter, they'll just not accept. We were interested in a house and our agent found out that there were 2 offers on the table and that the seller wouldn't even consider them b/c they were below a certain figure.

Re: offering below asking

Re: offering below asking

Posted by maymama

Posted by Jenhos

We are selling our house now and are open to hearing all offers. You never know what their situation is.

Are you ready to buy now? Nothing to sell? Are you pre-approved? These are all things I would take into consideration when thinking about an offer we get.

we are in a condo but have a buyer with a full cash offer so basically, we are ready to move just need to find "the place". we have 40-50% to put down in cash, pre-approved, great credit etc. i think its an ideal situation for a seller...

Re: offering below asking

legally all offers have to be presented but even in this market, there is such a thing as an insulting offer. that said, i don't think your offer falls into that category.

i am in contract (as the seller) now and let me tell you - i hated this experience. we had three offers come in, the third of which was made after we took our house off the market. we're selling at $11k below our last asking price. woo hoo!!

our lawyer says that in this market, you do well if you break even.

Re: offering below asking

Personally I'd start at a place where you have room to negotiate. So if you think it's fairly priced, I'd start at 475-480 and then be willing to come up closer to 500k when they counter. If they dont counter (which we had happen with our current house), you can still increase your bid (which is what we did after sitting tight for a few weeks).

Re: offering below asking

We offered 70k below asking and we got our house 40k below asking price. It was exactly what we needed. go for it.

Re: offering below asking

thanks everyone!!! we are going to see it on Saturday

my DH's uncle/aunt are brokers in Nassau and they say that in this market, if the buyer doesnt laugh at your first offer, you have offered too much. i know there is a fine line between a low offer and insult so we will do our best not to cross it

Re: offering below asking

good luck karin!!!!!!

if it's fairly priced i wouldn't expect them to go much lower...usually the fairly priced homes sell really quick for close to their listing price - at least in the area i am living in....but NY real estate is foriegn to me i just know what goes on where i live b/c i stalk the mls and property appraiser to find out what things are going for and selling for...

lots of luck!

Re: offering below asking

The only way to make a reasonable offer is to get comps. Just because you can only afford x,y,z does not mean the house is worth that.

If a house is on the market for $350K and everything else similar in the market sells for $340-$360.. you know the house is priced accurately and negociating might be harder or just a few thousands to play with. Regardless of how much you can afford a house. Of course, the terms of the contract might help you (short closing, paying cash, etc...). Of the seller really want a fast turn around.

On the other hand, a house priced at $399 in the same market with nothing really substancial to justify a price higher than $50K vs. other similar houses in the area might leave room for negociation. But again, some sellers are still in lalaland on how much their house is really worth.

Re: offering below asking

It's hard to answer that without seeing the house, comps etc. It can't hurt to offer what you can afford and let the seller decide if they're interested in your offer or not. When we sold our co-op the first offer we got was 20k below what we were asking and we turned them down. Six months later we accepted the same offer, we tried calling the couple that offered that price first but they had already found a different apt. Ok back to you, the point of my story is you never know and if you love the house it's worth a shot!

Re: offering below asking

update - the house is gone sold day 1 on the market

oh, and our # 2-4 are also gone all sold within the past 2 days

Re: offering below asking

Posted by maymama

update - the house is gone sold day 1 on the market

oh, and our # 2-4 are also gone all sold within the past 2 days

Re: offering below asking

They all sold so quickly?
Just wondering what town?

Re: offering below asking

Posted by maymama

update - the house is gone sold day 1 on the market

oh, and our # 2-4 are also gone all sold within the past 2 days

Re: offering below asking

Re: offering below asking

We offered $40k less than their asking price and they accepted our offer the same day. It all depends on the sellers really..