Did you offer got accepted?

Thank you, everyone. We have definately done our homework. The comps in the area are $20 - $30,000 less than the current asking price. My realtor will be in touch with the selling agent to determine the sellers' needs and take that into consideration with our well researched offer.

Sounds like from the differences in answers, we can't really know what will happen so we need to decide the desired outcome and start with an offer that is fair in our minds. We will most likely offer about $25-$20,000 less than current asking and see what the sellers have to say.

Hi Linzabel

You make an intersting point when you responded the seller paid $187K in 2006 at "the height" of the market. It seems like you and your realtor have done the homework to justify a lower offer based on recent comparables, however the seller may be "upside down" with the mortgage (owe more than the market will bear for a sales price). That could result in the seller having to bring money to the table to sell their home(if they are able) or a short sale situation where theyhave to attempt to negotiate with their lender to accept less than they owe. The latter can be a time consuming process and not always successful.

If you really want the house, have your agent prepare an offer with full documentation on you as a buyer showing you are fully qualified and prepared to buy as well as current market information that is the same information an appraiser will use if you are buying with a mortgage which will dictate your ability to close the loan. Hopefully the sellers agent has prepared the seller for a "low" offer and will have the discussions necessary to at least begin negotiations on a possible sale to you rather than gettng upset and rejecting your offer outright.

if you were the seller, what kind of reaction would you have? You are looking at the tax appraisal when you should be looking at comps. We don't look at the tax appraisal when we list a home we look at comps. Just decide if you want the home or not, look at the comps and make an offer based on that knowledge. If you want the home, put your best foot forward, if you don't, then i wouldn't worry because chances are, they will not take an offer like that unless desperate to sell. Many times sellers get upset being taken advantage of and won't look at further offers from the buyer.

Hi Linzabel,

You can always offer what you want or what you think is right but there are always other things that factor into the price and motivation. The tax value is one of many pieces that factor into the equation as well as comparables in the area. The other factors that are tougher to quantify are, how much do you want the house or put another way, how bad would you feel if you didn't get the house and how badly do the sellers need to sell the house. Offering 25% off of list is pretty aggressive and can do one of two things: offend the sellers where they no longer want to deal with you or start the negotiation process.

The latest tax assessed value most likely doesn't include the many updates the sellers have done since they purchased the home and most, if not all, homes in that area and of that age could use window and furnace updates.

The other thing to consider is there have been a lot of multiple offers on homes lately. Your best bet is to put forward your best offer and see what happens.

Good Luck!

do a reverse question.
If you were the seller, what would you think if someone offer you 39,000 less?
Your Realtor will have the best advice since yur Realtor knows all the information.

Buy!

Assessed values are usually less than the actual property value and in some cases are more than the actual property value. The assessed value is used for tax purposes. The actual value is what the market supports. You will need to find out what similar homes in the area are selling for to know whether this is a fair market offer.

You can offer anything you want. The sellers response will depend on their motivation and need or reason for selling. They may want to just get it sold and move on, or they may need to get close to list price.

Our realtor feels the home is maybe worth $150,000 to $160,000. The closest comparable sales in the area were recently sold for $130 - $155,000.

The current owner paid $187,000 for the home in 2006 at the height of the market....

You can offer whatever you wish, but have your financing information, pre-approval, rationale such as comparable sales, improvements or updates needed, etc. If you need help with financing, call me, Liz@612-986-4105.

First, I would always recommend getting the advice of your agent--there's a reason you're working with them.
Second, tax values, although a data point, really shouldn't play a large role in determining your offer price. They could be significantly higher or lower than the true market value.

Finally, look at what homes are selling for in the area. If you offer too much off from what the home is truly worth, all you'll do is poison the well and make for difficult or impossible negotiations which will likely result in either (a) not getting the home or (b) making the final sell price higher than it would be if you entered the negotiations with a reasonable/credible offer.

Your offer could be rejected or counter.
What price does yoru Reator think the property is worth?
Ussually listing price is close to sell price. Request from your Realtor a CMA based on such property and check how close/far your offer will be.
Assesment value is for Tax property porpuses.