Home Buying in Chicago>Question Details

Heather, Other/Just Looking in 60655

In a buyer's market what is the average % you should take off the asking price when you make your offer.

Asked by Heather, 60655 Wed Aug 15, 2007

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When making an offer there is not usually a % one takes off the top to submit an offer. Protocol would be for your agent to do the comparables on the property you are interested i.e.homes that have sold in the last 6 months. One would then compare for like kind and quality, how long it was on the market prior to receiving an offer and maybe the needs of the seller.

If the property you are considering has been on the market from some time with no price reduction then you structure your offer accordingly.

We usually say if a property is listing within 5% of what it should sell for you will have that offer within the first 30 days. A properly priced and marketed property will sell almost immediately.
Web Reference: http://pamwinterbauer.com
1 vote Thank Flag Link Wed Aug 15, 2007
Pam Winterba…, Real Estate Pro in Danville, VA
MVP'08
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There's not necessarily a % off when you submit your offer. Your offer is based on Sold Comparable sales within the last 6 months. Not all houses are listed at a fair market value, therefore, you need to know what houses are selling for in order to place an offer. Sometimes, your offer will be way off asking price, sometimes really close to selling price. The only time I go in with a % off asking price when I represent a buyer is if there's really nothing to comp the house to. Then, you can search the statistics and do a market average % +/-, but it's really not the best way to go.
Web Reference: http://www.dianeglander.com
1 vote Thank Flag Link Wed Aug 15, 2007
Hi Heather,

The input you've gotten so far is good. Another thing to factor in is, how much do you want the home? Some people in this market are thinking they can come in really low and have lost the property they really wanted because of it. You risk offending the owners to the point of them not wanting to even consider your offer and you risk having someone else come in higher

Cathi Weaver
Web Reference: http://www.cathiweaver.com
1 vote Thank Flag Link Wed Aug 15, 2007
My first suggestion is to talk to your Realtor to come up with a fair price for that specific area and neighborhood. I definitely would not suggest having a percentage in your mind. What I have seen happen is a buyer thinks it's a buyers market so they "low ball" the seller but the house was fairly priced and another buyer offers a fair price and wins. Each house is unique. Each offer should be carefully considered rather than just taking off a percentage of the list price. If it's in move in condition, priced right, and has what you are looking for--don't waste time with low offers--bid fair or someone else will.
Web Reference: http://www.amywengerd.com
1 vote Thank Flag Link Wed Aug 15, 2007
Every seller sets their price individually. Two homes that are very similar could carry offering prices 50K apart. A percent off the ask price would provide hugely different sales prices.

Look at recent comps, inventory status, recent activity, competitive properties, absorption rates, and determine the price that makes sense. If that price is 5% below ask, and you secure a contract and wonderful home, then you made the right decision. It might be ask, it might be 15% below ask, or even more.
1 vote Thank Flag Link Wed Aug 15, 2007
Deborah Madey, Real Estate Pro in Brick, NJ
MVP'08
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If you are truly in a "buyer's market" and the home is listed with a Real Estate company the seller has been advised to price according to the market. Make sure and have you agent compare local sales and see if the seller is priced properly. One word of caution if you really like the house don't make an offer that would result in loosing the home you want. I know in our market that it is actually in balance but because of national advertising buyers are under the impression that it is a "buyer's market" here and are losing out on good properties by making decisions based on National numbers not local numbers so make sure you have the correct information for your area.
Web Reference: http://www.mtils.com
0 votes Thank Flag Link Wed Aug 15, 2007
Heather,
The first thing to check is the area comps. Asking 10% off a home that is priced 15% too high still means you are paying too much. Depending on what the comps show, if the price is fair what I like to do is ask for about twice the "typical" reduction in your area. In my area list price to sales price is usually a 3% difference. If I ask for a 6% reduction I can determine how flexible they are without (usually) insulting them. I have found that to be an excellent method in my area.

Talk to your agent and determine what the typical reduction is....

Chris Tesch
RE/MAX Bryan-College Station
Web Reference: http://www.ChrisTesch.com
0 votes Thank Flag Link Wed Aug 15, 2007
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