Home Buying in 48603>Question Details

Jennifer, Home Buyer in Saginaw, MI

What is a good rule for offering lower than the asking price?

Asked by Jennifer, Saginaw, MI Wed Sep 26, 2012

A house is listed at 44,900 for 6 months bank/hud owned I want to offer but not sure how much

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Answers

8
LISTING PRICE
Understand that the LISTING PRICE has one primary objective, to attract attention: It is not intended to be set in stone, and in many cases it is not even a good guideline toward the SELLING PRICE.
Some Sellers believe that by setting the LISTING PRICE high, they can always come down, and people will make an offer anyway: WRONG! Buyers will just bypass the property and look at houses that are within their price range. And six months from now, the Seller will slowly start lowering the PRICE, (this is called “chasing the curve”) and Buyers will be asking the question; “What’s wrong with that house?” and “Why has it been on the Market so long?”
Other Sellers set the LISTING PRICE low, to attract multiple offers. (The correct strategy.) We are asked; “Aren’t you obligated to sell at this price if someone offers it?” The answer is probably not; for that to happen, you would first have to have only one offer, and secondly, the offer would have be exactly the same, down to the smallest detail, (please discuss this with your Realtor).
Another thought; Buyer will search for potential properties by groups; for example, $400,000 to $450,000, and $250,000 to $300,000. If your house is priced at $460,000 or $310,000, the Buyers will never see it. (something else to discuss with your Agent.)
Different Banks have different philosophies about pricing their properties: You cannot draw any conclusions without a good analysis.
Have your Realtor do a CMA, (Comparative Market Analysis) to help you determine your Offering Price. It is the surest way to determine the Market Value of the property.
1 vote Thank Flag Link Wed Sep 26, 2012
HUD homes are hard to offer much less than asking. If its been up for 6 months though than maybe you could offer less and get it. I would check homes that have sold in that area with the same features as that house and see what price they went for. Then I would base my offer on that. It really depends on that house and location as to how much lower you should offer, also check and see if the price hasnt been lowered already. Usually the price is lowered if a home has been listed for that long and theres been no movement. I would say for a HUD home honestly offer closest to list price as you can afford because HUD offers are submitted via bids, and anyone can swoop in and bid higher before your bid is accepted. Consult your agent as well. Thanks and good luck! Any other questions feel free to ask me at annadeel@ymail.com
0 votes Thank Flag Link Wed Sep 26, 2012
$44,900 on market for 6 months and is a HUD home.
Under normal circumstances, such homes are listed below value to attract multiple offers AND SELL QUICKLY. There is reason to believe there may be a situation present that is at this time undisclosed to Trulia readers.

Calcullate the real value, (based on your purchase objective) and remember, until you submit the offer the answer is always NO!.

Best of success to you,

Annette Lawrence, Broker/Associate
Remax Realtec Group, Palm Harbor, FL
727.420.4041
http://RealEstateMadeEZ.us
0 votes Thank Flag Link Wed Sep 26, 2012
Sit down with a realtor and research the market in the area. This will give you a grasp on selling prices as well as discounts. Hope this helps!!
0 votes Thank Flag Link Wed Sep 26, 2012
I think Ron spelled it out very well for you Jennifer - thumbs up for him :)
0 votes Thank Flag Link Wed Sep 26, 2012
Since we have no facts on the property, you would want your agent to pull comps in the community. You will have a better idea on what homes are selling for. The way the market is today don't be surprised if the property has multiple offers on it and sells for more then asking.

Good luck
0 votes Thank Flag Link Wed Sep 26, 2012
Since we have no facts on the property, you would want your agent to pull comps in the community. You will have a better idea on what homes are selling for. The way the market is today don't be surprised if the property has multiple offers on it and sells for more then asking.

Good luck
0 votes Thank Flag Link Wed Sep 26, 2012
There is no "rule" or specific percentage to offer below listing price. It's largely dependent on the true market value of the home.

For example: A home whose market value is $100,000 might be listed for $90,000. A full price offer might be called for.

The same home listed for $200,000, clearly overpriced... a 20% offer below listing price, and you'd still be overpaying by a lot.

It's better to determine what the real value is, and nobody better to do that for you, than a local Realtor.
0 votes Thank Flag Link Wed Sep 26, 2012
Alan May, Real Estate Pro in Evanston, IL
MVP'08
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