So, what do you do. First, you determine the real value of the house. Not the listing price. Not how much it's been discounted from the first listing price. Not how much it previously sold for. Not the tax assessment. No. None of those. Determine the darn value. Look at the comps. Factor in the condition of the property versus the comps. Once you've done that, that's your ceiling. Your maximum price. Go one penny above that, and you'll be overpaying. (One additional comment: If there weren't any offers at $270,000, then we know that $270,000 was too high, regardless of any other calculations. It may be $260,000, or some number between $260,000 and $270,000. Or it could be less than $260,000).
So now we've established the ceiling.
How much can you afford? Reasonably afford? Take that number. Put it next to the ceiling number we've just established. Take the lower of those two: what you can afford and the ceiling number. That's the most you can spend on the house. That's your revised ceiling.
Then, and only then, do you make an offer. You can make it at your ceiling price--essentially paying either full price for the property or paying up to the maximum you can afford. You COULD do that. I personally would suggest a somewhat lower number than your ceiling price. How much lower? That's up to you. Maybe 5%-10%. But that's your call.
As the other agents here note, short sales can take a long time. They can be frustrating processes. Frustrating both because of the time involved and because of the sometimes seemingly irrational decisions of the lenders. So be prepared.
Hope that helps.
Have your Realtor do a market on the home including those sold in the area recently, and the answer should be simple. I'd be aggressive on the offer, as it is a short sale, but you need to offer what you're comfortable with. Ask yourself how you'd feel if you lost this home?
I hope that helps......
Thanks, Todd Norsted
If you want the house you should be prepared to offer 90 to 95 percent of asking price or more. Your Realtor will be able to tell how close to asking price the average house in that MLS district sells for. I wouldn't expect 60k off, at that point the bank will just go through with the foreclosure.
Michael Doyle Realtor
I have wrote offers on these short sales several times in the past few months and what the other agents here are stating in regards to the mortgage amounts, situation, and even whoever is running the file at the bank can come into play. Do a little research on the previous sale of this property and figure out where the bank might be willing to go.
Also, as Brian stated, prepare for a wait in the bank's response. I wrote one offer for a client over asking price on a short sale. We received our response from the bank 1 1/2 months later and it was "No". Just because they have a price listed doesn't mean that the bank will accept the offer. They might chose to just let the foreclosure run its course.
Keep talking with your agent and voice these concerns to him/her. If they have dealt with this type of property before, their input could prove invaluable. Have them show you why they think that a full price offer is necessary and have them back it up with some numbers.
It pays to have a professional working in your best interests. Without seeing the home, everyone here would just be shooting from the hip and guestimating prices. That doesn't do you any good.