First, you want to have seen a variety of homes in the area. When you find one that is right for you, ask a Realtor to prepare a "CMA" comparative market analysis" This shows at least 3 similar homes in the area and what they sold for. The sales must be recent, preferably within the last 6 months. You might want to drive by the homes that are listed as "comparable" to be sure there are no hidden factors such as a bad location or a really pretty lot.
Second, what's it worth to YOU? Does it have a special feature that the others you saw don't? Do you anticipate that you will need to spend additional money shortly after you move in? Make an offer in line with your budget, and don't go over your budget without a compelling reason.
Get a skilled agent to work up a range of value on the house, there is no answer. That agent should also war game the seller's position, brief you and develop an agressive plan. If you don't care about the house go very hard - if you like and want it, smile as you insert the knife.
If you're qualified and ready to close then you should be appropriately agressive - how aggeressive depends on the data.
Hank Miller, SRA, ABR
Associate Broker & Certified Appraiser
Prudential GA Realty
You can't apply an across the board % rate to real estate today. I don't care what Clark Howard says!!
You have to find the home you want in a condition you are willing to accept and let your Realtor dissect the neighborhood and community to find out an acceptable price for the property. This will be a number that I will tell you if you go over you will have paid too much!
Once you establish that number it's time to negotiate with the seller and try to get the best deal you can without buying outside the price range of the community.
If you are interested in looking for homes in Avondale Estates I'm currently working with another client in that area and have a good insight to what's on the market there and where some good homes are. Feel free to contact me anytime!
ERA Sunrise Realty
Trying to work a formula that you got from somewhere may cause you to miss out on a property that you like. What kind of condition is the house in. If you want numbers to justify your bid you should work with repair costs and market value.
Why would you say 75% when there may be a possibility that you can get it for 70% of asking price. What does that matter when the current list price is 30% below the original list price? Where does all the figuring, estimating and planning end and the bidding begin?
Real Estate will never be perfect...I have a client who bought at $279,000 now the price on the sign in front of the subdivision reads $220's and the builder is giving away upgrades. Sometimes real estate is just gut instinct. Get a super patient agent and start low. Only The seller knows what they will and won't accept.