We are still in a declining market if you pay todays market price it is actually based on recent closings which were sold or under contract 60-90-120 days ago. Have your agent determine the rate of market decline in your area here in Charlotte NC it was 3.7% decline from last year. That means if equal homes sold last year at $200K this year they should sell at $192.6K. Note: Never let the tax value be part of the your offer or selling pricing. Tax values have nothing to do with the current real estate market.
There are many beautiful homes in great neighborhoods available with Big Big $$$ savings? As a buyer you should be looking at "Short Sales" & "Foreclosures" they are where you can save thousands versus buying a retail MLS home. If you can't save 40% - 50% - 60% on a home including any repair or cleanup cost you should run away. There are too many excellent choices for a qualified buyer.
I have sold and purchased "Short Sale" & Foreclosure" homes in beautiful condition fully furnished the sellers walked they just wanted out. Also homes that were junkers but the deal was too good to pass up it's all about the $$$.
My wife and I live in a home we recently purchased as a "Short Sale" it was alot of paperwork and time for me the agent. But in the end the bank reduced the amount they were owed on the loan by $325,000 we got a great deal. The home did not need any repairs as most foreclosures do it was move in beautiful condition. With "Short Sales" be flexible with the location to get the best deal.
Bill Carey, Broker/Realtor
Bill.Carey@HendersonProperties.com l http://www.HendersonProperties.com
the property "tax value" may be 20 years below market value because MOST tax authorities revise property tax when the property is transferred.
in cases of REOs, again, the county will generally tax a property by the appraised value at the time of sale
So it is important that the Realtor that advises you knows the local market. Prices are no longer declining in the Austin area. of Texas. They have been relatively stable for 3 months, and the inventory of homes-that is how many homes are on the market - IS going Down. Many homes that have sat on the market for months are now getting multiple offers. Many buyers are being disappointed when they learn the offer they made wasn't good enough, and someone else is getting the home they wanted.
The fact that the cost of FHA loans in going up because the PMI payments are goin up at the end of March, puts our market in a spring thaw.
The market price for a one story 1900 sq ft home built in 2005 may be 20% more on one side of a subdivision than on the other.
I'm afraid the out-of-state Realtor is talking about his market. Cedar Hill median prices for sold properties has not varied up or down more than 2% in 2 years. The Dallas market did not have the huge run-up in prices during the 2004-2006 timeframe, that later collapsed. The market has drifted down, but some neighborhoods in Dallas are actually more than 10% up year over year.
Tax appraisals are not all that accurate, but they are gross indicators of relative value. Don't expect more out of them.
Foreclosures do affect the market and can be used to pressure sellers into giving a better deal. If you want the foreclosure property, go buy it. My guess is you didn't like the foreclosures because they had deferred maintenance and repairs to be done. You can still negotiate and try using the foreclosure prices to beat up the seller, but don't take as gospel the prices foreclosures are offered for sale or sold for. They're not.
For a report on prices and trends in an area, try this handy little spamless website http://www.DallasHomeValueReport.info
Put them to work and have them look at the market comparables and they can get you market value for the property you are looking at. And despite what Scott said below, you can find great deals in this market, especially if there are other foreclosures in the area. And no, you won't always "pay full price" with "lousy contractors, blah, blah blah"... that's just a realtor's tactic to get you to skip the lower priced homes for the newer or remodeled homes (where they get the most commission). Don't let realtors sway you, stick with it and find that great deal that you're looking for, that's the best thing you can do in this buyers market.
One way to reduce the number of 'issues' you have to deal with is to hire an experienced Buyers Broker (I'm available ;-D). Seriously, someone who has bought and sold 100+ houses has seen most every thing you may run into. Better than that, you generally don't have to pay them! The Sellers Broker pays them, in most cases.
I have other great answers to commonly asked questions if you look at my Trulia Blog or http://www.realtorville.blogspot.com.
If I can help, I will!
Scott McDonald, Broker
Scott McDonald Realty
You offer what you think the home is worth. You can get an opinion and a market analysis from a Local Real Estate agent to help you decide on a number.
There may be negotiations after you make the offer; but ultimately you have to decide what you are willing to pay.