There are other ways to get the seller to drop price OR help with closing cost. Call me if you have any questions. My website is below.

Mon Jul 14 2008, 14:20

Hi Joe, every market is different but let me share some observations from my area in New Jersey. Perhaps it will be helfpul as you think through your strategy as a home buyer.

My recommendation is that you work with an agent that knows your particular market well. He/she should be able to put together a pricing analysis, using the facts - data/trends - of the market to arrive at a bidding range that you can justify. I use a Pricing Analysis that extrapolates the trend in the market, applies it to the market comps and arrives at a range. I do this for every home of interest to buyers I work with. It immediately flushes out overpricing and is a compelling tool in the bidding process because an offer you can substantiate makes for a compelling case.

In my market, homes are generally selling for 1-5% off of list, when that list price hits the proper "strike price", whether that is right out of the gate or after several price reductions. The smart sellers are pricing on the mark right from the get go -- case in point, a seller I'm working with who listened to my recommendation on price listed their home on 6/09 at about $690K and we are already under contract at $685K.

A sound pricing analysis is the best recommendation I can make to you - use it to guide your bidding and you will do great. I always try to present offers in person - looking the seller and their agent in the eye, with my pricing analysis on the table along with our offer. A conversation that begins with "Let me show you why we believe our offer is a fair one..." is far more likely to lead to success than throwing out numbers pulled out of a hat. It is hard to run from the facts. Keep it cordial, because if you don't succeed in engaging the seller, you can always regroup and try again.

Best,
Jeannie Feenick
Weichert Realtors
Search and connect at http://www.feenick.com

Mon Jun 30 2008, 05:22

Are you only asking for the 5k off the asking price or are you asking for 5k off the price AND your closing costs paid (which would be more like asking for 10k)? I think most sellers have been educated enough by their agents to expect to have to cover about 5k or so in closing costs in this market so I don't think 5k is unreasonable -- but if you're wanting both 5k off list AND closing costs, that's going to be a bit tougher to find.

Do you have pre-approval for a loan? This can make your offer more attractive. Financing is harder to secure in the current market so this could make your offer more attractive.

You do have an advantage as a first time due to the fact that your offer is not a contingency offer. A lot of buyers are trying to sell their old home in slow markets which puts the seller in a tough position of having to wait for the buyer's house to sell. Otherwise, everyone else's money is just as green as yours.

Mon Jun 30 2008, 03:53

The first line should have a "it" instead of "and".

Mon Jun 23 2008, 16:00

One common mistake a lot of buyers make is assuming that being a first time homebuyer is an advantage and has nothing to do with negotiating the price with the seller. It is actually not an advantage as a first time homebuyer does not have a history of mortgage payments for the lender to evaluate. I work as a mortgage broker and I have numerous programs that are designed for first time homebuyers so there is no negative effect.

I believe John answerd part of the question by stating that prices are sticky coming down. Homeowners in this area are used to homes appreciating well in relation to the rest of the country and are reluctant to lower their prices. There are however, numerous homes that have been dropping in price. By stating that you are looking for a property that is $5,000 of list price isn't the best way to look at it. For one, I don't know what percentage that is of the list price. If you are looking at a $90,000 home, the percentage is a lot higher than $5,000 off a $250,000 home. Also, keep in mind that not every home is priced correctly to sell so $5,000 of the list price may still be too high. You need to approach it as a certain percentage off of the market value. I can definitely help you out with this and securing a mortgage. If you would like shoot me an email at dbrown@cavaliermort.com, I would love to help you find the deal you're looking for.

Mon Jun 23 2008, 15:58

The Triangle area has generally strong employment and the housing market reflects that reality. You'll find better deals in some neighborhoods than others, but that is the case anywhere in any market. Currently, desirable Triangle neighborhoods are not seeing any appreciable price decreases and well maintained and smartly priced homes sell at or close to list within 30 days.

Thu Jun 19 2008, 20:17

Michael said, “I think the media has once again been successful in creating the consumer attitude they want.”

Yes, as I’m sure the media was responsible for fueling the real estate mania that occurred from 2000 to 2006. They were also responsible for prices doubling in that time as they ran so many positive stories about real estate.

Fundamentals are killing real estate. Not the media.

Joe – remember, prices are sticky on the way down. Markets like Las Vegas had median price increases through 2005 or 2006 I believe. The median numbers can sometimes mask the true condition of a market when sales volumes are low.

Be patient. Don’t fall in love with any one house. In this economy, you will be able to drive a hard bargain. It’s not 2005 anymore.

My humble opinion: you’ll find that the overextended, marginal buyers (2000-2005 vintage) that are now in distress are most likely located outside the city, in the suburbs.

Good luck,
-John

Sun Jun 15 2008, 18:21

Joe,
Don't be deterred. Yes, in our are many homes are still getting 97% of the list price. But there are deals to be found everywhere if you are willing to keep searching, and willing to walk away when neccessary.
Best of luck to you!

Sun Jun 15 2008, 17:11

Bank of America is located in Charlotte. Raleigh, along with Charlotte has shown consistent, steady growth and is able to "weather the storm" over most metropolitan areas that experienced huge jumps in home values in a short time period. If you are "looking for a deal" in the Raleigh market, you have to compare neighborhood stats (3/6/9 mos. supply) and then feel out the mindset of the seller when you make the offer. If they aren't anxious, they aren't anxious. Sometimes there are indicators, like relocating for a job, home has been on the market over 90 days, or the home is listed competitively for the size and neighborhood.

Good luck!!!!

Mon Mar 24 2008, 14:03

wait a year or so, could be a totally different story.
Isn't Bank of America located in Raleigh, NC?
wait and read the news, it should be interesting this year.

whats the hurry, are you in a hurry to get 30 years of debt?

Mon Mar 24 2008, 13:55

Joe,This is not a Buyers Market in the Triangle,We have levelled out to a normal market.
You can still get a house for below list as long as there are some imperfections on the house that you are willing to forgo.

Mon Mar 24 2008, 13:32

Hi
I think the media has once again been successful in creating the consumer attitude they want.
Homes for sale will sell for what the market is willing to pay. The willingness of a seller or buyer to negotiate from the asking price is dependant on many things, including need to sell and time frame to sell in. My suggestion would be to look at the comps in the neighborhood and offer a price that is 97 to 99% of the asking price ( for this zip) and decide how much you want this house. If you love the house $5,000 on a $200,000 house is not going to change your monthly payment as much as letting interest rates get higher while you search for another.
Michael

Mon Mar 24 2008, 08:23

Have your agent to run an absorption Rate in that neighborhood. This number will give you a good picture of the market condition. Remember, real estate is local. Even withing the same city, the market is different depending on the demand and supply. Buying real estate is not same as buying a car from a car lot. You always can come back and offer the same price on the same car. There is only one house with a uniq lot size, sitting, amenities, upgrades, and neighborhood.

Good luck,

Jean

Sun Mar 23 2008, 16:30

Joe,

I hope this doesn't offend, but what you believe the market to be or not to be does not mean you will get what you what.

For Example: I have a seller who says that he will only sell a home for "X" price and not a penny lower. If the market says his house is worth less and he will not budge, then his wants are unimportant. Same thing goes for the flipside (buyers looking for a deal)

If a home is priced right and the seller knows that it is, there is no reason for them to reduce the price. Why would they if they think the next guy will pay their price.

You will have to find a place where the seller is willing to deal.....which is exactly what you said you do not want.

Sun Mar 23 2008, 15:55

If they don't want to play ball for $5000 less, than acquire your home a different way and save up to 45% on the deal. If you want some more information, email me at - info@serapisdebtservices.com

Khazeem Asadullah

Sun Mar 23 2008, 15:45

Have your agent show you the list and sale prices for the last month for properties where you are looking. That will give you a great feel for how realistic you are being. In my area homes are selling for apx. 96% of list price (depending on the Broker they are listed with).

What % of the list price does the $5000 drop you want represent? 10% or 1%?

Sun Mar 23 2008, 13:57

It seems as if the news that you're believing about recession, mortgage crisis, and everyone in distress doesn't match your reality. Well, start with homes that are already in distress (Short sale, preforeclosure). In none exist are in the area in which you want to live, then have your agent work hard to show that the value you're offering is in fact fair. Do some research to figure out what percentage of the asking price are sellers receiving in the area you want to live?

Just because a home is on the market, it doesn't mean that the majority of sellers would accept any offer that comes there way. People sell for many reasons and for most, they'd rather wait for soemthing better to come along. Finally, make sure your offer even worth accepting. Are you including a pre-approval letter from a reputable lender? If so, up that to a loan committment. Are you offering an earnest money deposit that's worth the hassle of your offer. Depending on the pricepoint, 1% is still the norm ($500 for lower priced properties). Are you willing to close quickly or do you have any other contingencies that may delay or prevent a sale?

Like fishing; if you cast enough times, eventually you'll catch something. However, fishing the wrong spot may cause you to miss out on the big score.

Sun Mar 23 2008, 13:13