Home Buying in 32259>Question Details

Rosa, Home Buyer in Saint Augustine, FL

if seller is a developer whose property has not been sold for past year or so, what is the right offer?

Asked by Rosa, Saint Augustine, FL Sun Aug 24, 2008

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As a Buyer's Agent I would first do my home work to determine what the original asking price for the home or property was in the beginning. The home or property may or may not have been reduced several times within the year. This will help determine builder motivation. I would also do a market analysis to determine the current market value range for comparable homes or property in the area. I would also determine if the development is in an area of comparable communities. If the current asking price is in line with the market value of the property, I would determine what the areas average selling price is in relation to the list price and adjust my offer accordingly. If the current list price is above what the CMA suggest I would also adjust my offer accordingly. I also research and know all the incentives and discounts offered by the developer's competition.

The success of taking advantage of a really good deal is to know the market and present an offer that is backed by factual data. The developer knows its competition and can recognize a buyer who is serious and knows the facts or a buyer who is fishing and wishing.

Today many buyers are making offers that have no basis or merritt. If you do your homework and know what is truly a great price for the property or home, you won't let a great deal pass you by. Too many buyers are making offers based upon some percentage they have in their mind. (Fishing and wishing) It doesn't matter if the home is already priced 10% or more below market value buyers still fish and wish. Buyer's are making offers that are 5 to 25% below the asking price and are insulted when the seller doesn't accept and go away empty handed.

Some seller's counter with an offer that would equal and ADDITIONAL 5% to 10% below the current market value of the home making a truly awesome deal for the buyer. Buyer's are walking away without realizing the great deal they just missed.

There are other factors in addition to price that can make the purchase a good deal.
If the property you refer to is a builder inventory home that is priced right. I may approach my offer differently. Many builders may hold a minimum price to maintain pricing integrity for home owners who live there. If the home is priced competitively, in addition to asking for a reasonable price reduction(5% or below) I would ask for incentives that would give the buyer the most bang for the buck such as:

Developer buying down the Buyer's interest rate
Developer paying all buyer/seller closing costs and prepaid items.
Developer adding upgraded appliances or a nice fridge, microwave, irrigation system, screening the lanai, adding a rear yard fence etc.

If you are knowledgeable about the property, the area market, other developers, you will know what incentives of those you asked will make this a really great deal for you.

I highly recommend you interview area Buyer's Agents who also specialize in new construction ( for builder inventory or vacant land) if you are referring to a lot or acreage. A knowledgable realtor can do all the research for you and represent your best interest.

If I can assist please contact me.
Web Reference: http://www.cathysloan.com
1 vote Thank Flag Link Mon Aug 25, 2008
This is a great question. One of the great things about Real Estate is that the market dictates value. If you are interested in a property but only for a certain price...make the offer and see what happens. The worst thing that they could say is no! However, do your research. Ask your REALTOR to find out how much other homes have sold for in the area. A good agent can pull that information up for you so that when you go to the developer with your offer you can show them your research. Here's the other thing. Whatever the offer, the home will have to appraise for the sales price or higher. Your agent should make sure that you have verbiage to that effect in the purchase and sales agreement.

For more information contact me directly or check out my website.

Matt Zimmerman
Broker Associate
Prudential Network Realty
(904) 514-2466
Web Reference: http://www.MattSellsJax.com
0 votes Thank Flag Link Sun Aug 24, 2008
That depends. Everything has its price. If the developer is asking $100K more than the property should actualy sell for; then an offer of $100K+ would be in order. There are many reasons that a property remains unsold. Price is a major reason, but certainly not the only reason.
0 votes Thank Flag Link Sun Aug 24, 2008
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