A house is priced $15k under value. You could offer asking and still get a good deal.
A house is priced $59k over value. You take $50k off and still overpay. You should figure out (or have a realtor do a CMA) what the property is worth. Then with cash offer under that amount. Cash is king and many times people take less money to know they have a sale.
Make sure you have an appraisal contingency in your contract. Just because you have cash does not mean you should overpay for a house.
Here in Fredericksburg, homes are selling for about 95% of asking price. 90% offers are low but, not usually considered offensive. Cash will make your offer stronger so, you may end negotiations a few percentage points lower in your favor. I hope you are working with a realtor who can help walk you through the negotiation process! In this market, do your research and if you are in line with the facts don't be scared to offer low. You may just be surprised at the deal you can make! Good Luck.
I may have caused some confusion with my terms, however, admittedly I never used the term "list price"...I only referenced "retail price" and "fair market value." I consider retail price to be the equivalent of Fair Market Value (FMV), not to be confused with "list price" which may or may not be the FMV / retail price.
If my neighbor wants to sell me a car with an actual value of $20K (retail price / FMV) and he wants me to buy if for his asking price (list price) of $30K, I would decline because the retail price or FMV is still $20K. So, whether it's a car or a Van Gogh or furniture, when I pay cash I expect a discount unless the "list price" is substantially below the FMV / retail price.
Just wanted to clarify.
You make the smart purchase by knowing what the value is, not by clipping the list price. If I'm willing to sell you a Van Gogh for $100,000 - you really want to hold up the deal to bargain because you're "all cash?"
our 5% lower. Go from there- seller comes back with $290,, cash-- I would take. First off you can close faster- seller doesn't have to worry if buyer can get loan. If a seller takes a offer of 250, cash. You are not getting a deal, seller just had house over priced. You don't see too much over pricing in this market. -- I'm not a broker or a agent. I just wish to help-- maybe I did?
If the home is priced to sell, your cash offer better be high enough to make the seller feel it's attractive. 100% of asking price may be a real value if the comps reflect that the home is priced right. Be careful falling into the trap of cash offers netting you a huge discount. It isn't always the case. Yes, your home purchase won't be contingent on the sale of another property, and it won't require financing approval. That's why cash is king. But, if the offer doesn't net a desirable result for the seller, they will counter or pick someone else's offer while you're trying to steal the house. Keep in mind, at closing and funding, when a home is sold for a positive gain, the end result is still cash to the seller. How they get it factors in, but isn't a set in stone rule. It just takes some of the tentative nature of the contract off the table.
Have a blessed day!
2. You make your money on a home when you buy it, not when you sell it.
3. When you pay cash, NEVER pay retail price.
4. What are comparable homes selling for in the subdivision?
5. How bad do you want this specific home?
7. How motivated is the seller (researching the public records sometimes yields a plethora of valuable info).
8. How long has the home been on the market?
9. Is the home occupied (owner or renter?) or vacant?
10. Rule of Thumb: Offer approx. 75%-85% of fair market value (assuming the home needs few repairs).