Home Buying in Sunnyvale>Question Details

Michelle, Home Buyer in San Francisco, CA

Listing Sales Price is Final Price on new townhome development, or can I still make an offer?

Asked by Michelle, San Francisco, CA Sat Feb 9, 2013

Hi, I am shopping for a townhome and have been eyeing a development in Sunnyvale. The selling price has increased over $100K in 6 months. The onsite agents said there's now a lottery for the releases and the list price is fixed, meaning no bidding is involved. I'm wondering if there's any room for negotiation (under the list price of course)? The list price is now $850K, but there's been some recent sales transactions in Dec 2012 that is public information and show some units that sold for $682K and $770K. What are my chances and would the developer be open to an offer? Thank you very much.

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8
Michelle
The reason that there are lotteries at the new developments in Sunnyvale is because there are so many more buyers than there are homes for sale. The reason the prices have increased $100,000 in the last 6 months is because there are so many more buyers than homes for sale. There is absolutely no chance that you will get a home under the asking price. There is no reason for the builder to accept a lower offer when they have so many buyers wiling to pay the asking price. Last week there were 2 resale town homes listed under 700K that sold over 900K. 850K for a brand new town home is not unreasonable in Sunnyvale in this market. If you want something for less money you could try to find a home in Santa Clara, San Jose, or Campbell.

I am sorry the market is so crazy, but that is the reality of the moment.

Marcy Moyer
Keller Williams Realty Palo Alto
marcy@marcymoyer.com
DRE 01191194
650-619-9285
Web Reference: http://www.marcymoyer.com
1 vote Thank Flag Link Sat Feb 9, 2013
Hi Michelle,

The majority of the Bay Area housing market is experiencing a brutally strong Seller's market that has little time for haggling over price which I do not see significantly waning until Q413 after more Sellers are influenced to list their property along with a slow increase in mortgage rates over the same time frame.

The bottom line answer to your primary question is: Pay the price now, or wait .... Or, maybe change direction. Perhaps you might ponder the wisdom of these Rolling Stones lyrics:

"You can't always get what you want
But if you try sometimes well you might find
You get what you need"

Is the development in Sunnyvale a want or need?
Do you need to live in this particular development or is this just a want?
How long do you intend to live in this Townhome?
How secure is your job?
Would you be better off investing that extra $100K remodeling an existing home? ..........

-Steve
0 votes Thank Flag Link Sun Feb 10, 2013
I don't know this development, but generally speaking new developments tend to tow the line on pricing in order to keep prices up for subsequent sales. However, they are generally open any to all fo the following: credits for closings costs, free upgrades on appliances, finishes, window dressings, etc..., and prepaid HOA dues. This can amount to a pretty significant amount of money. If you don't have an agent, find one who is experienced in this type of project.
0 votes Thank Flag Link Sun Feb 10, 2013
Hi Michelle and thanks for your post.

I believe I know the development you are referring to and the answer to your question is "no".

The prices are the prices and I guarantee that if you do not want to pay the current list price, the next guy will gladly do so.

The market in Sunnyvale is red hot, and the prices recently posted were for homes sold as much as four to six months ago, but closed when the properties were completed. They are no longer a comparable for the homes.

If you really want the new home, I am afraid you will have to agree to the price. No negotiations will be possible here. Sorry.

Good luck,
Grace Morioka
Allison James
0 votes Thank Flag Link Sun Feb 10, 2013
Hi Michelle,
I agree with most of what the others have stated.

In general, if you have an agent who is aware of the current market conditions, he will know what strategy to use at what time.

The strategies of 25, 15, 5, or even 2 years ago, won't work now. The real estate market changes every year. If you go to the seller and try to use a tactic from 2 years ago in today's market, it may backfire.

Work with an agent who knows today's market and is flexible enough to adapt to the changing times.

Robert Lei
Century 21 Sunnyvale
474 E. El Camino Real
Sunnyvale, CA 94087

Cell: (408) 893-2410
Masters Ruby Award winner at Century 21 M&M and Associates, the #1 Century 21 in the world.
0 votes Thank Flag Link Sat Feb 9, 2013
Hi Michelle,

If you can let me know the development you are interested in, I can look up and see if you can find something comparable or better for a the same price.

Aparna
Cell: 408-691-7717
email: realtoraparna@gmail.com
Member of National Association of Realtors®
Member of CA Association of Realtors®
Member of Silicon Valley Association of Realtors®
0 votes Thank Flag Link Sat Feb 9, 2013
Here is the catch - the sales that were closed in December were negotiated and contracts were ratified months ago when price levels were lower. It may have been the asking price on the day of contract signing.

I don't think you much of a chance to negotiate the price down now as there is such a shortage of housing - both for sale and rental.
Web Reference: http://talisrealestate.com
0 votes Thank Flag Link Sat Feb 9, 2013
If you took your real estate agent with you when you visited the homes and signed their register, you should ask your agent. She will be the one most familiar with your situation.

The best general advice is work with an experienced agent who will learn your situation and use it to your advantage. If you didn't take an agent with, and you signed the register in the sales office, they will be very reluctant to negotiate with your agent but it might still be possible.

If you are doing it on your own all you can go by is very general advice and trial and error. Find out how many homes are being offered and how quickly they will be finished. Plan a strategy using what you learn. Decide what your fall back plan will be. In spite of what you were told, there is probably some room for negotiation. However, what can you bring besides money? An agent can find comparable sales and use that to make a strong case for the offered price. An agent can help promote their homes to the right buyers. An agent can bring more buyers who are already qualified and ready to buy. The builder can come out ahead by working with agents unrelated to the project.

Good luck with your game plan.

Sunnyvale real estate statistics at http://julianalee.com/sunnyvale/sunnyvale-statistics.htm

Juliana Lee
Cell: 650-857-1000
Top 3 agent nationwide at Keller Williams Realty

Over 25 years experience
Over 1,000 home sales in Santa Clara and San Mateo Counties
.
Web Reference: http://julianalee.com
0 votes Thank Flag Link Sat Feb 9, 2013
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