Home Buying in Belmont>Question Details

Elaine, Home Buyer in Brookline, MA

Is this home overpriced?

Asked by Elaine, Brookline, MA Mon Jun 30, 2008

We're looking at a home in Belmont that the owner purchased last year for $555k. They did a lot of updates to it, including finishing the attic (not really usable as bedroom, but cute bonus room). Now they're asking $795k. That seems like a pretty steep increase to me--I'm sure the work they did added value, but not a quarter million in value. It's a small lot with not much level yard, which was probably the reason it was low in the first place. Would it be insulting to offer 85% of asking?

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Whether a house is over priced is determioned by the market. A house is worth what a buyer is willing to pay for it at this time. This begs the question: what is this house worth to you at this time based upon your needs and expectations. You see home buying is not about the market, its about you. And, equally important, the best time to think about selling your house is before you buy it.

You may be over paying for the property even at 85% of list, a lot more information including an on-site evaluation is needed to render a informed opinion. The information you provided is a starting point in a forum discussion but it is by no means ample for a professional opinion.

Several good articles about what a home is worth and what it is not worth can be seen at: http://LivingWellinSanMateo.com/?$=what+your+house+is+worth .

One final thought: What is the seller needs to get or what the seller wants to get are not relevant is establishing the homes value to you. Don't be swayed by the emotions of the seller or yourself.
0 votes Thank Flag Link Tue Aug 19, 2008
Sorry, I forgot to say Belmont, MA when I posted this question. It does make a difference! Anyway, it's higher than what trulia lists as comparables. I guess I'll offer what would be median for similar things we've seen and see what happens. Worst they can do is turn us down! Thanks for the advice, everyone.
0 votes Thank Flag Link Tue Jul 1, 2008
There are two issues involved:

First, what is the house worth today, with the improvements? I can't comment on the Belmont market because I don't know it. However, in many markets that would be a steep increase in value. However, if they bought it under market value a year ago, then intelligently added some enhancements and upgrades, and if the neighborhood can support that value, then it could be worth it. On the other hand, if they bought at market value...if prices have remained flat or declined...and if they've been watching too many shows on cable...they may think that $250,000 in upgrades equals an increase in value of $250,000. It seldom does. Bottom line: You really have to have a Realtor familiar with the area run comps.

Second point: You ask: "Would it be insulting to offer 85% of asking?" Who knows? And, generally, who cares? Some people get insulted if you offer a penny less than the listing price. Some listen to Realtors claiming that houses sell for 97% (or whatever) of the listing price, so they get insulted if the offer is lower than that. It doesn't matter. And don't try to read the seller's mind. Figure out what the house is worth. Really worth. Then adjust that number depending on how much you like the house. Know what you can comfortably afford to spend. Then make an offer no higher than the lower of: (1) the house's value to you, after you know the market value, or (2) what you can comfortably afford.

Hope that helps.
0 votes Thank Flag Link Mon Jun 30, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
Contact
hi there - are you looking in Belmont California or Belmont Massachusetts ? An updated home in Belmont California at $795,000 is an attractive price. However, as with any home you are are considering be sure to have your agent do a market analysis on the home and its neighborhood. Need assistance feel free to contact me :) thanks mary molinari coldwell banker 650.996.7981
Web Reference: http://www.marymolinari.com
0 votes Thank Flag Link Mon Jun 30, 2008
Hi Elaine, Ask your realtor to do a cost comparison with the house your interested in and what homes in the same area have sold for. After that you might better be able to make an offer you are comfortable with. In the search he will be able to pull up properties in the immediate surroundings as well as a broader circle. Price per square foot might help, but make sure you are comparing apples to apples and not apples to oranges. How long has it been on the market?

At the end of the day make an offer you are comfortable making trying not to offend but being fair to yourself. Hopefully an offer will get negotiations going. The sellers realtor HAS to submit every offer they get. Call me if you need a realtor. 949-632-3129 I live in Long Beach and work that area.
0 votes Thank Flag Link Mon Jun 30, 2008
I have a listing in Belmont for $ 598,900., this house is own by Bank. In one day I recieved multiple offers all over asking price. This house need updates and infested with termites and dry rod. The market in Belmont didn't change a lot. In my opinion you need aRE agent to see how the price offered by seller compares to the current area market and agent will help you to determine how much youtr offer should be

gene

http://www.gemcondultants.net
0 votes Thank Flag Link Mon Jun 30, 2008
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