if you feel the home is overpriced and the seller is not willing to come down on the asking price, you should move on to another property.
Do not get too hung up on any one property, because you may make a decision based on emotion rather than sound business sense.
Sometimes if a home sits on the market long enough, a seller who is priced too high may come down to earth.
Best of Luck to You.
Kawain Payne, REaltor
By the way, I'd hope this condo for this high price was beyond stellar, updated, upgraded, gold laden and a personal butler...etc...if it needed any work such as tile, flooring, nice new double pane, central air and granite and stainless stell, then hell to the no, hon.
Century 21 - Real Estate Sr. Agent
Associate Professor of Real Estate 101-201 -Boyle Heights Career College
A great strategy to determine if the asking price is reasonable is to do a comparable study. This is how an appraiser would assess the property down the line if you plan to finance the property. Appraisers are notoriously conservative these day so it is important to make sure you aren't over paying.
A comparable property study will involve reviewing several sold properties within a half mile radius of the property. Comps should have the same bed/bath count and be in reasonably similar condition. Most realtors will provide you with a CMA (comparative market analysis) that will help you understand the price. If you don't have a realtor, I'd be happy to jump in!
What is important in determining the price is what a buyer is willing to pay for it as well as recent comparables in the area. I've been selling and buying condos in Weho for sometime and the last 6 months have seen at minimal a 15% increase in prices. It's one of the fastest growing markets in LA. Without knowing the address or specifics on the property in question I wouldn't be able to say if it's overpriced. Call me if you want to discuss!
KW Beverly Hills
If available it would be best to have comps within last 3 months because the home values are increasing. The average on those sales will give you the average price per square foot. If there are enough sales you can compare original condition properties to updated/renovated values. In my opinion, I do not judge what seller paid for property. I judge what values are today.
Gail Mercedes Cole
You should not have to ask the listing agent...you definitely want an agent looking after your interests in this or any other transaction. If you have any more specific questions, please feel free to call me and I would be happy to discuss this with you.
Prudential Beverly Hills
310 849 2485
or Call me: (310) 600-1553
I can tell you what it should REALLY sell for. Lets make an offer and get it for you.
Rodeo Realty Beverly Hills
I am an agent with Prudential California Realty in the Beverly Hills office. I specialize in the West Hollywood area. If you are not working with an agent at this time, and have not found a home yet, I would be happy to assist you. And who knows, perhaps the property you were talking about is still available.
Please fell free to contact me directly: 310.777.2877
I would say if you look at http://www.city-data.com, you will see a area drop of about X%. Apply that X% to the house you are buying in your area, that serves as a reference point. Other pointers include location, renovations and perhaps city ordinance changes etc.
Engel and Voelkers Hollywood Hills is also available to provide you free professional service as a buying broker.
Given our current market conditions, comps must be no older then three (3) months to be of any value. Please take my advice and retain a good buyer agent. A buyer agent will help you determine the right amount to offer for that property.
In today's market even the appraised value and comps may not be a valid sales price in the eyes of the selected lender. Be aware that Lender's are cutting the sales price to what they feel may be a fair selling price based on their risk. So, that means that even though you may be willing to pay $719,000, the lender you select may cut the appraisal to a lower value and be willing to finance the property below your anticipated loan amount (assuming you make a 20% down payment = 143,800 for a loan amount of $575,200) meaning they may finance only $503,000 instead of $575,200. Just be aware. It's happening a lot--that's why many deals are falling out. As the year progresses, foreclosures are growing and lenders are becoming extremely uneasy about their risk taking ventures. Good luck.
Krecker and Associates Appraisal Services
We provide real estate appraisals for:
Primary and secondary mortgages
Private mortgage insurance removal
BPO and REO
You say, "My feeling is that there is no way in a down market that the property could be worth more today than it was 3 years ago." Two problems there: First, with all due respect, your feelings (or beliefs, or hunches) have nothing to do with prices. Comps are comps. Prices are prices. Second problem: You refer to a "down market." Granted, in many areas of the country, property values are down. I mentioned the condo price drop of 40%-50%. I can show you townhouses and single family homes with 30% drops and more. But that's in specific neighborhoods 2,800 miles from you.
Even you acknowledge that "Similar comps for West Hollywood do seem to show selling prices today in the mid $600,000s." Assuming those are good comps, that'd suggest that property values have risen by about 5% (from $620,000 to $650,000) in the past 3 years. That's not a down market; that might only mean that the condo priced at $719,000 might be overpriced. But then we get to: Are those comps valid? Condos in one building may be worth more than in another just because of the building they're in. What floor they're on also has an effect. The condo fees in the building can affect the price of the condos. And so on.
And why are you talking to the seller's agent? (I do agree with the seller's agent that comps are by far the best way to determine a property's current value.) What does your agent say? (Ummm...you do have an agent, don't you?)
Hope that helps.
Condo prices are higher then they were in 2005 in WEHO. They haven't declined to the levels they were before that. Without any improvements I'd say the price is about what they paid or a hair more. I wouldn't trust the agent's appraisal. What really counts are the comps. I'd be happy to run them for you if you would like. But they shouldn't be older than 4 months. People still are moving to WEHO and it's one of the few strong condo areas in LA. With that being said there are also a lot of short sales bringing values down slightly but there are many micro climates and it depends on the building and it's location in town.
Remember that all real estate is local first and foremost. You are correct that overall trends would predict the value has dropped up to 30% over the past 3 years, this area of Los Angeles could have held value above the national or regional average. Therefore, the Realtor is more correct that very recent sales, adjusted for differences, establish the value along with replacement value minus depreciation and so forth. That is how the unbiased 3 party - a licensed appraiser of your choice- would evaluate the property.
Another approach would be to look for other properties. You might want to look for a good buyers agent to represent you. We suggest an agent with a CRS designation (top 5% Realtors nationally) and an ABR (Accredited Buyer Agent) as well. Be sure to establish how commission would be paid. It is typical that the seller would be paying the commission. Go to some open houses and compare for yourself what else is available.
First of all, what the sellers paid 3 years ago has nothing to do with the value today! Maybe they underpaid then. Analyzing the comps is your best method of determining value. If truly comarable condos in the area are going for the mid 600,000s, you should offer in the low to mid 600,000s.
Do you have your own agent? If not, find someone right away who can advise you properly. If the sellers of this property won't budge, find another condo. There are plenty on the market today.