Home Buying in 80234>Question Details

woots1, Home Buyer in Ocala, FL

What would a fair offer lower than asking price be on a property that has been reduced at least three times in the last year . If the buyer has cash.

Asked by woots1, Ocala, FL Mon Jul 28, 2014

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Hello woots1,

Recently I've had some closings on properties where cash offers were involved and the price was negotiated down slightly. As has been mentioned below, it somewhat depends on where the property is listed in relation to comparable properties, because if it's priced very aggressively then the odds of it going below list are tough due to very tight inventory levels. However, several things that I've done is typed up contracts closing in a week and a half to 2 weeks, doubled earnest money asked for and only had minimum contingencies (title, inspection & HOA docs if necessary) in the contract where all the dates & deadlines were all within 1 week of the date of the offer. One property I bought was on the market for 5 days and was a 2 bed, 2 bath condo in downtown Denver that I negotiated down from $395K to $385K, another was a 2 bed, 1 bath condo by DU that was negotiated down from $185K to $180K, another was a 1 bedroom condo by Glendale that was negotiated down from $79K to $75K. Anyway, it's very case specific and there are many properties going at or above list price, however there are some properties that where by doing some things to structure the contract a certain way can help with negotiations.
0 votes Thank Flag Link Tue Aug 5, 2014
Hi woots1:

Looks like things got a little tense below. But to answer your question, the only thing that really matters in making an offer is the actual value of the home in question. If the comparable properties tell you the third price reduction is on target or low, then no reduction may be your best bet in this seller's market. If the price still looks high, then you should only offer what the comparables tell you it is worth. As for buying with cash, it often does suggest to sellers that there is a better chance you will close. But price always is the key, with one exception. In the Boulder/Denver area where I am located, buyers often offer above the asking price because home inventory is so low. In these case, cash buyers sometimes decide against having an appraisal or promise in the offer that they will purchase at the contract price even if the property does not appraise. This is definitely a powerful tactic when there is a danger that the bidding has topped the appraised value.

0 votes Thank Flag Link Mon Jul 28, 2014
In response to your question....Ask a local realtor. I offered cash on a short sale that has already seen the deal fall through twice in the last year. It was listed at $32,000, reduced to $25,900 and i offered $17000. Check the comps in that area and estimate how much work the property needs. Make sure you inspect the property! There has to be a reason why the price keeps being lowered.
0 votes Thank Flag Link Mon Jul 28, 2014
Here is a current story of what can happen to a seller when they choose a cash buyer.

There is more risk than most sellers comprehend.

0 votes Thank Flag Link Mon Jul 28, 2014
Wow. You've giving us a lot to work with.

Many CASH buyers are BROKE.
Many CASH buyer are not in control of the money.
Many CASH buyers have drank the Kool-Aid.
Seller know CASH is a smoke screen for 'uncommitted.'

Clearly you know you can offer List minus one dollar.
Or you could offer list minus 25%.
But you already know that.

It seems to me your question is a second guess action.
The best purchase strategy will be dependent on the property.
If it is a foreclosure of a specific type, there is already in place a well defined and understood pricing policy.

If a short sale, it does not matter what price you offer at this time.

If a traditional sale, three issues MUST be addressed.
Price is only one.

Your REALTOR will guide you regarding how to structure your offer, build your offers authority and justify the price.

Just a little insight. 60% of home sold in Pinellas County Florida are cash purchase. Don't place unmerited value on being a cash buyer. It is the bait most broke 'investor types' dangle.

Best of success,
Annette Lawrence, Broker/Associate
Palm Harbor, FL
0 votes Thank Flag Link Mon Jul 28, 2014
I am highly offended with your idiotic reply. I have a cash offer on a home and I am NOT BROKE! I have absolute control of my money and I dont think i have drank kool-aid in the last 20 years!
We are just a regular hard-working family that decided to skip all the crap of a mortgage and save up.
Flag Mon Jul 28, 2014
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