Home Buying in Bradford>Question Details

Peter Ruecker, Home Buyer in

Need advice to negotiate a short sale...

Asked by Peter Ruecker, Fri Dec 12, 2008

I found a property I'd like to put an offer towards in the next 1-2 months. It's a townhouse in move in condition with finished basement end unit. It's currently listed at 264K, and has dropped 5K off it's original list price 38 days ago... I plan on offering 10% below and asking for 6% towards closing.... The property is in Bradford, ma close to Zion Bible College (formerly Bradford College). My real estate agent thinks it's risky. Please help! Thanks

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Thanks for your info, I'm waiting a month in order to pull all my finances together for the downpayment... believe me i wish i could do it right now!

I'll hhave to talk further with my real estate agent...
0 votes Thank Flag Link Sat Dec 13, 2008
I would focus on what the other properties have sold for recently and base your offer on that accordingly. If you are that interested, I would not want a month or two. Why so long ?

2009 has a great chance to be a turnaround year in the housing market. I think the consumers paralyzed by fear will regret not making a decision in terms of buying but only time will tell. And more importantly, everything is based on your local market !

As someone who studies risk, would need to know more info about your local market. But outside of that, your quality of life issues should play a deciding role. And do not forget about mortgage rates being at record lows !

For more helpful hints and resources, visit http://www.thesomersteam.com .
0 votes Thank Flag Link Fri Dec 12, 2008
Hi Terrence,

This will be my first home, and i plan on living in it for the next five years. I will put in the offer and see what happens, any other advice you can provide regarding short sales is appreciated! thanks for your help
0 votes Thank Flag Link Fri Dec 12, 2008
Peter,

Actually, I listed one particular property in January and we had a signed agreement within three wks. The client wanted me to list the property in early December. We used that month to prepare the home and it was listed with an initial offer price that was correct for the market.

As for the future of the market prices, no one knows. I do know that it is about as close as it will be for buyers to make an investment in a home. Interest rates are about as close to bottom as they will be. There are individuals wating the Fed to drop the rates even further, but there will be no guarantee on how far down they will go. I don't think much further below 5% for the consumers.

It also depends on what you want to do with the home. Are you going to fix it up and sell it? Or are you going to live in it for a good period of time. Flipping the home should only take six to eight weeks. The market shouldn't change that much so quickly. Ten years from now, if you choose to live in it, the economic situation should long be over with and you should make a decent profit anyway.

If you are moving from a smaller to a larger home, now is the time. If you are moving from a larger to a smaller home, now is not the time. The choice is entirely up to what your needs are. Don't try to second guess a market which can't be predicted.

Good luck.

Terrence Charest
0 votes Thank Flag Link Fri Dec 12, 2008
Terrence, my real estate agent thinks its risky because she feels that the list price is much lower than what they originally sold for two years ago.

With the current market conditions, dont' you think property prices will continue to drop, considering jan and feb are traditionally the slowest moving months in real estate?

Thanks for your help
0 votes Thank Flag Link Fri Dec 12, 2008
Regarding seller's assist, the short sale, in essence, implies that a Seller/Homeowner is unable to satisfy the loan amount in full. Most banks won't structure the deal with a Seller's Assist because they are "giving away" proceeds that could otherwise payoff the loan; they would have to answer to shareholders of the bank's equity.
0 votes Thank Flag Link Fri Dec 12, 2008
What do you mean by "he thinks it's risky"? Does he think the home is priced according to the market and is a fair price which would put your offer below it's worth? Asking for 6% towards closing, in itself for a short sale, is very risky.

Although, to look at your side, what's the worst that could happen? They would decline the offer. You could then put in another offer.

You also need to look at the total time on the market, which your agent should know. I understand the 38 days for this current listing, but has it been offered for a longer period of time. Just 38 days would be too short of a time to be risky with your offer. Also, banks tend to sit on lower offer for longer periods of time and there is basically nothing you can do. You will also need to see what the addendums will look like. Have your agent ask for them to see what additional stipulations there will be.

Hope that helps.

Terrence Charest
0 votes Thank Flag Link Fri Dec 12, 2008
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