Right question: "How do I make sure I pay no more than the fair market value of the property?" And a bonus question: "How can I get the best price for the property?"
Basing your calculations on the listing price of the property is meaningless . . . because there's often little or no relationship between listing price and fair market value. You're assuming there is. There isn't.
First, find out what the property really, truly is worth. Ask your Realtor to run a CMA (competitive market analysis) on the property. That figure is the MOST you should pay.
You may want to offer less. That's a strategy your Realtor can help you with. There are times that a full-price offer makes sense. There are other times when you should offer 10%, 20%, or more off the listing price. But you won't know until you know the real value of the property and develop a strategy for paying no more than that amount.
Hope that helps.
Tom Brady SFR, e-PRO, SRES, GREEN, BPOR
Licensed Real Estate Salesperson
Notary Public, Retired N.Y.P.D. Lt.
#1 Listing & Selling Brokerage in NY
Charles Rutenberg Realty, Inc.
255 Executive Drive - Suite 104
Plainview, New York 11803
In many areas of the country real estate value are increasing. In the premium areas of Dunedin FL buyers will be bringing 23 to 50 thousand dollars in cash to pay the difference of the predictably low appraisal. .
If you are a real buyer, as opposed to a predatory, paper hanging investor, you will offer market value.
Market value works pretty well. Notice I make no reference to list price, tax value, mortgage balance, distress status or the many 'vapors' buyer like to chase.
Know why you are buying. (residence, cash flow, long hold, flip, wholesale)
Know the 'like kind' comps.
Know the community forecast.
Then make your fair market value (according to your goals) offer.
Some cases X cash flow requires X purchase price. Not emotional, just business.
The good stuff is selling ABOVE list price with less than 3 days on market. How would your plan work in that environment?
The important thing to recognize is, "if you don't ask the answer is ALWAYS No!" So, get your offer in and get the conversation started. You never know what is on the other side if you don't open the door.
Best of success to you.
Buy working with a local real estate professional you should be able to review recent sales comparison information to arrive at a "game plan" that produces information on which to base a reasonable offer and not one the offends the seller by proposing an off the wall offer based on guess work.
Contrary to what many buyers believe, homes in some cases are selling for more than the asking price. Where would that leave you on a discounted offer of 15%. You will most assuredly stand a much greater chance of success by working with accurate data.
Licensed Associate Broker
Accredited Buyer Representative
William Raveis Legends Realty Group
You should focus on learning what a property's value is within the area you're looking for. Take into consideration any needed repairs or upgrades, the amount of rooms from one house to the other, garage or no garage, etc. and also your budget and monthly payment should have a significant importance.
If you're looking for a better deal, I suggest you look for houses that need a lot of work, or foreclosure properties. You'll more than likely do better on those.
Senior Loan Officer
Sterling National Bank
Ask the Realtor who is representing your interests to run recent comparative local sales so that you know what the market value is of the home that interests you.
Your opening offer can be a bit less than this figure.
Also consider what the home means to you; it is more than a commodity.