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Kaira West,  in Portland, OR

Assuming a home is priced appropriately, what factors do you consider when advising buyers how much to offer on a home?

Asked by Kaira West, Portland, OR Mon Dec 20, 2010

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I have often gotten the question by buyers "What should I offer?" I offer the facts of thorough CMA, which should be as close to true comps as possible. I always try to tell them to lean toward being within the current average % of list price home have sold for....have them offer based on actual data rather than trying to lowball the seller. Then you have to let the buyer tell you what they feel comfortable with. (It must be their idea...make your client the powerful ones. ) You as an agent can suggest the various ways they can present the offer for the best possible response, give them choices....but always be realistic with the buyer if they are out of the range of reason. If they want to lowball you must know this well in advance of showing property...you could be wasting your time and if you want to give them one opportunity to learn by be sure to reeducate them after they have their first offer rejected. Train your buyers to know the limits (reasonable percentage of list price that homes sell for)....based on the actual stats provided in RMLS. This will go a long way in getting to a closed transaction.

On the other hand....Listing agents should use the same data...don't list higher than what the comps show...not even if the seller tries to convince you to do it their way for a while. if they insist tell them they need to pay you up front for the advertising that you have to incur to try to make their property appear worth more than the market will allow. That should help bring the point home. It's best to hold true to the market or walk away from an unrealistic seller rather than waste your precious time, energy and money.

All the Best and Merry Christmas!
June Lizotte, Principal Broker, GRI
Providing REAL Service
june@junelizotte.com
503-310-8032
Web Reference: http://www.junelizotte.com
0 votes Thank Flag Link Wed Dec 22, 2010
The last time I ran a CMA in NE Portland, the average home sold for about 103% of list.
0 votes Thank Flag Link Mon Dec 20, 2010
While real estate agents can guide a buyer to choose the right number, don't expect a buyer's agent to name your price. Experienced buyer's agents will provide direction, market information and suggested price ranges, but the final price is the buyer's responsibility.
0 votes Thank Flag Link Mon Dec 20, 2010
Rule of thumb: 1-3% off if the property is correctly priced.
0 votes Thank Flag Link Mon Dec 20, 2010
Run a very detailed CMA from every angle possible and give those reports to your buyer, explaining them. If your mls shows asking prices vs. sold prices of the comps, I would show them those and take into account the ones that also had fair asking prices. I would advise a range of what I would offer I were them and give supporting evidence for your numbers based on that CMA. Just be sure to tell them that it is their choice to offer what they want and you are just there for support and advice to support their level of need for this particular home. Also, I would ask them how many years they plan to stay in the home and be sure that you try your best to estimate that they get the return on their investment they are looking for, if any (of course let them know you do not have a crystal ball, but that the trend shows this and that).

If they would be crushed to get completely rejected without a second chance, then I would not lowball.

There are so many factors to list. I would have to see the home to decide which factors should come into play, but here are some I can think of:

Quality of School district for resale purposes
Past Utility averages
Proximity to Interstate exit, dining, shopping, entertainment
Proximity to downtown (if not there already)
Traffic conditions in that area during rush hour
Condition
Is it in need of any renovations or need updating at all?
If it has carpet, does it need cleaned or replaced?
Is there a bedroom downstairs?
Does the lawn have weeds or need redone?
Landscaping needed?

I would be sure to compare all of these features and more, to the sold comps. If there is anything lacking, come up with an estimation as ammunition ready for the agent when negotiation starts.

Good luck!
0 votes Thank Flag Link Mon Dec 20, 2010
I first try to get my buyer educated so they understand the market in the area that they are buying. Showing actives and pending sales and show them sold homes and then we can look on line at the pictures after you looked at the areas. If I recommend prices and they don't buy the house then I have actually recommended a price that was not to what the seller was thinking. I don't suggest any price for my buyers to start at. I always let them decide; when they are educated this is so much easier.

Tom Inglesby, Broker
RE/MAX Equity Group inc
503-319-9035
0 votes Thank Flag Link Mon Dec 20, 2010
K: I always start with my buyer's comfort level with the pricing combined with condition. If it is truly priced correctly, I will share my opinion but bow to their wishes as far as our offer price. I do run comparable data so they gain confidence. But, with all the inventory available, most buyers become very good partners in determining value.
Janeese Jackson, Principal Broker
Real Estate Resource
503-709-0802
jj@janeesejackson.com
Web Reference: http://fabulousportland.com
0 votes Thank Flag Link Mon Dec 20, 2010
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