It's a myth to think there's a formula to offer prices. If any realtor tells you, "oh, just take off X %," get a new agent.

Houses are worth what someone is willing to pay. You can determine this by seeing what comparable houses have been selling for. Have a realtor prepare a true apples to apples CMA to determine your offer price. Make sure the comps are of SOLD houses, not what's on the market. Who knows if any of those houses on the market will sell.

Also, make sure your realtor makes adjustments for different features and the condition of the home. If they just say, "well, this is the average," ask how specific things can affect that number. You can add some cushion to leave room for negotiating, but if the house hasn't been on the market long, and it looks priced right, and the comps sold in short periods of time, I'd factor that in to how much you choose to offer. You can submit a lowball offer, but if there are multiple offers then you'll miss out on the house you want.

Diane,

Buyers and sellers today should be paying very close attention to the value at which property will appraise since banks will not loan money for a property that does not appraise for its sale price.

Is it necessary for you to have an appraisal done on all of the properties you are considering? Obviously not but a skilled real estate agent can access the information necessary to arrive an approximate value for these properties by reviewing and comparing recently sold similar homes in your target location.

Once you have determined the home's value it will be easy to determine where your initial offer should be to arrive at a price that is both acceptable to you and an accurate reflection of today's real estate market.

Best wishes,
The Eckler Team

Greetings Diane,
I think the best formula will be based on your ability to manage your finances.

We are an instant gratification society...look at the trouble that has caused. What I mean that you should take ALL of the financial factors in to play when trying to decide how much to bid. To simply say something like 80% of asking price is really shallow.

What are you expecting to pay each month for a mortgage payment?
What is Homeowners Insurance?
How much are the State taxes?
How much are the City/County taxes?
Do you have an annual sanitation bill?
What will the utilities run you each month?
How much are you contributing to your savings each month?

I think in this economy not looking at everything with regards to where your money is going could be detrimental. Just try to make sure that you can save or if you choose not to save it have some disposable/emergency/mad money.

Good luck, be safe and Happy 4th of July!