Home Buying in Albany>Question Details

Musicmom, Home Buyer in Albany, OR

With up to 120,000 CASH, what price range should I be looking in so as not to offend sellers and not embarass myself.

Asked by Musicmom, Albany, OR Sat Oct 29, 2011

We have been looking primarily at short sales and foreclosures and aren't sure what % below asking to offer/ also wondering how far owners will usually come down.

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8
Dan Tabit’s answer
Musicmom,
There is no rule. Pricing is not a controlled element. Some people overprice and agents hope they will come down to what the market indicates. Others under price for a quick sale or to create a bidding war.
If I were your agent, I'd look at homes up to $150,000, but remind you to not get emotionally attached to the homes well over your range. When you find homes that you like, I'd research them, their time on the market, the status of bank owned or short sale and we could discuss a strategy to try.
I wrote a blog piece about pricing a house that might be helpful for you. I’ve attached a link for you below.
One question, with $150,000 cash and rates at and below 4% have you considered financing? I don't know the Albany market, but it would appear you have multiple options with that much cash.
1 vote Thank Flag Link Sat Oct 29, 2011
Musicmom,
Do you only want to pay cash? If so consult with a buyers' agent. If you plan on getting a mortgage, speak with a mortgage officer before you go any further.
1 vote Thank Flag Link Mon Oct 31, 2011
Please call us at Clock Tower Realty in Albany. We would love to help out!
541 967 9483
1 vote Thank Flag Link Mon Oct 31, 2011
It will depend on the property you are looking at and what kind of sale it is. Short sales have very little wiggle room and some foreclosed properties have been dropped to their lowest figures. Some home sellers individually wont be able to go below the price they have listed otherwise it might shove them into a short sale situation. So, in this case - I would work with an agent in that area that would know these different scenarios to know how high they can go without causing you a problem with your cash, etc.
1 vote Thank Flag Link Sun Oct 30, 2011
Hello Musicmom,

The answer to this question is somewhat complicated because there are so many factors to consider. In a short sale there may be more than one mortgage involved and the two lenders will not come to a meeting of the minds. Bank foreclosures, especially when they are new on the market will often not consider much of a lower offer. On HUD homes there is a little calculation I have followed with successful results. I agree with the realtor who suggested $150K range. If you would like some actual figures on homes in the Albany area, I would be happy to provided them for you. Give me a call at 541 971-1165 and we can talk about it a little more. Meredith Lankford, Keller Williams Realty Mid Willamette
1 vote Thank Flag Link Sun Oct 30, 2011
I'm not sure "not offending sellers" is something any buyer should be concerned about. Your Realtor should be able to run a Comparative Market Analysis to get a good idea of what a market price would be, and then adjust that for how long the home's been on the market or other factors unique to that home or seller.

"Market" is not the list price, though it may be. "Market" starts with what truly comparable homes in the neighborhood (no more than one mile radius, in the same city, have actually sold for in the last 3-6 months.

But there is no magic percentage for offers. A buyer's Realtor is ethically bound to present any offer that's not "frivolous". A seller's Realtor is ethically bound to present ALL offers to the seller. While I will write the offer, I frown on buyers making an offer that's lower than what they believe the home is worth to them "just to see if we can steal the place". Don't write offers on homes you don't really want to buy, just to see if you can buy something below market.

One advantage of having the buyer's Realtor presenting the offer to the seller's Realtor is that it takes the emotion out of it. No one needs to get "offended" over a business transaction. Either seller and buyer can come to an agreement or they can't. No one need should be offended or embarrassed about the process, regardless of the outcome.

Remember the advantage of the cash buyer is that the seller knows the escrow will not be derailed by the buyer's lack of approval for a mortgage or the home's appraisal. That's worth a lot to some sellers, and not much to others.

Finally, unless you have LOTS of time and LOTS of patience, don't shop for short sales. My personal experience includes a six month wait to get an answer, and that's not a record. Read my blog post at http://bit.ly/rqUfvq
1 vote Thank Flag Link Sat Oct 29, 2011
When my clients are hoping for a cash deal, but have a very limited amount to work with, I recommend talking the a loan broker for a back up plan. You want to have some flexibility in case they counter and you really like the place, or the closing costs are more than you expected. Even if, because of an bad credit you don't think you can qualify for a conventional loan, any hard money lender through a loan broker might just help you put together a touch down! Best, Terry Bell, CPS Real Estate, Santa Rosa, CA
(your thumbs up would be appreciated!)
1 vote Thank Flag Link Sat Oct 29, 2011
This is a general question with a case to case answer. Different factors affect the willingness of a seller to accept a lower offer. The best thing you can do is find a home you will like to purchase and as your agent to get information for you to be able to determine what to offer for a property.

I would be happy to help you with this process and help you find informed answers.
0 votes Thank Flag Link Sun Oct 21, 2012
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