While all the answers below have truths to them, I didn't notice one factor mentioned that I would consider very important. The price range the house you want, happens to be within. If the list price is more than competitive, and it's less than $400k, there are probably going to be multiple offers, and it likely end up selling for over list price.

If the price is higher than $600k, you can probably negotiate, because there isn't much probability of multiple offers - unless the price is more than 20% less than nearby non-distressed listings. Your agent should know by looking, if a property is "priced to sell".

There isn't a % off the list price to shot for. The bank is the one you need to deal with and they know what they will except. Your agent and you do a market evaluation on the property, then you decide how much you are willing to pay and put an offer in on the property lower than that figure. Right now, I tell my clients put your best offer in, no games. The bank on a short sale may not get back to you for 30 days and then ask you to up your offer and wait again. Going with your best offer and stating to the bank at the begining saves you time.

Pam,

The thing to remember about short sales is the seller must demonstrate "financial hardship" to the bank to be able to qualify for a short sale and must agree to the sale price arrived at between the buyer and seller.

The presence of both financial hardship and the bank's willingness to take a loss on the property normally leaves little room for negotiations. The bank's view could be to "wait and see" and hope they lose no money or get the property back in "foreclosure."

If you are looking for success...keep your offer real and close to the asking price for "short sales,"

Hi Pam, for ANY property a Comparative Market Analysis gives you the best representation of market activity/direction - for the specific property details you search on.

I personally feel median and average-based information is great for trying to appear well informed at parties on a macro level, but in my opinion these measures are meaningless for targeted selling/purchasing and advising a client. Given that a “median” is defined as “the number separating the higher half of a sample from the lower half”, this measure, as well as Average-based measures, have no regard for any of the specifics you may be searching for and can be skewed by segments of market activity that do not match your individual situation.

If you need useful and actionable information, identify a Realtor to work with and start drilling down into the specifics of your target criteria/area via the use of Comparative Market Analysis reports. This how you will be able to reach an informed offer amount for any home you seek.

Best Regards, Steve

Hello Pam,

You really have to do your homework with regard to the price you offer. If you want the Lender to take your offer serious the offer must net them in the range of 80% to 88% of the current market value. Keep in mind that is their NET. They will be covering the closing costs in most cases. I have had 100% of all short sales I have presented to a lender accepted. If you come in too low, you will waste a lot of time waiting for them to refuse your offer. Some times they don't even counter -- they just won't consider it and never tell you.

You should employ the services of a good Buyer's Agent in your area -- look for one with Short Sale experience and ask about their successes.

Good Luck to you.

Hi Pam:

It all depends on the asking price vs the market price. Bidding war can happen when the listing price is under priced at what the buyers consider as a great price for the house. If the listing price is high, nobody will be fighting over it, then you will over low.

Supply and Demand in a certain area at the moment you are looking the place generally determines the eventual pricing and there is no magic formula - Get a good Realtor who knows the in and out of your market, the market condition, the pricing strategies, with good reputation among other agents, then get his/her advise on how to go about making an offer. .

Best,
Sylvia Barry
Marin Real Estate

Hi Pam,

Cynthia is correct, the listing agent are under pricing for the very purpose of creating a bidding war. That being said, if you find a home you really want. We can sometimes get a good price by offering to open escrow and then wait for bank approval. This is how I always approach short sales any way. When an listing agent sends all the offers they get into the bank, we might end up competing against an offer that won't even be valid once the bank says "yes." Bidding wars is NEVER anything we want to do....but if we offer to open escrow, put a small deposit into escrow (and we incur no costs against that deposit), I often find that listing agents will take less for the home because they know we are committed. That adds value.

Hope this helps!

Karen

Typically they sell for over the asking price. On occasion you'll see a sale under asking price but not often. It's the same with REO's (bank owned properties). You'll find that these properties are aggressively priced in relation to their actual market value. In some cases, agents are underpricing the properties in order to attract attention to the property to obtain a lot of activity right up front. Since most buyers right now are looking strictly at foreclosures, bank owned and short sale properties, they are creating a competitive bidding environment with most of these properties which is bringing the prices up to where they would really like the offers to be...and what the bank is willing to accept. Is there a particular property that you are interested in? I am familiar with most of the properties in the area. Let me know and I will give you my opinion on the value of the property in question. You can reach me directly at: cfleming@coldwellbanker.com. Thanks.