Home Buying in Acworth>Question Details

Jeff Koehler, Home Buyer in Acworth, GA

Submitting An Appropriate Bid

Asked by Jeff Koehler, Acworth, GA Wed Aug 20, 2008

We are considering placing a bid on a home in a subdivision in GA. The house is the one of the biggest in the neighborhood and does not have any appropriate comps, especially with the amount of property, just assessed values which are half of the asking price. How do we know what is a fair offer? We are consider having a 3rd party assessment done, is that a good idea? Thanks

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Hi Jeff,
As everyone else has said, you should seek outside help. Wether it be an appraiser or a Realtor you should get some help. In the end you are going to need an appraisal even if you are using an agent. When you do get ready to make an offer just make sure that it is going to be contingent on the house appraising that way if the house does not get appraised for the contract price you will be able to get out with out loosing your earnest money.
Having said that, Larry said it best, a house is worth what you are willing to pay for it. It sounds like this house has a lot to offer you and has some collective features that are difficult to come buy. Best of Luck and have a great day!
0 votes Thank Flag Link Thu Aug 21, 2008
Jeff, It sounds like your knowledge in the matter plus all the advice from my fellow colleagues should be enough to feel confident in the final decision or offer you will make. If you have handled other real estate transactions in the past you’ll be comfortable with allowing the listing agent (representing only the seller’s best interests – unless practicing dual agency, a very delicate practice in the state of GA) to fill in the contract’s blanks and terms. You will allow yourself some ways out of the contract, should inspection or appraisal or survey reveal anything unacceptable for you. You’ll maximize the seller contributions in your favor and no surprises (liens, title issues, etc.) will arise without your knowledge or the option of walking away from the deal without loosing your earnest money…
In the event you don’t feel 100% sure you can handle all these variables, you may want to consider to hire a Realtor®. He or she will represent only your best interests. Please ensure whoever you may choose is highly qualified to represent you on the purchasing side (Accredited Buyer Representative) and trained in all possible real estate scenarios (short sale, pre-foreclosure, builder about to file bankruptcy, etc…). I have been in the business for 5 years now, my company requires me to hold the highest standards in the industry as far as knowledge and customer service. I am an ABR® as well as Certified Skilled Negotiator. Cherokee and Cobb counties are my areas of specialty. You can visit my web site at http://www.SellingATL.com , email me at swade@prudentialGA.com or call me at 404-547-6077 anytime if you choose to entertain the idea of not doing this alone…. My best regards and good luck to you. Stefania Wade, REALTOR®,ABR®,CSN,Relocation Specialist
Web Reference: http://www.SellingATL.com
0 votes Thank Flag Link Wed Aug 20, 2008
Jeff- I would recommend you seek outside help. As my fellow realtors have suggested, an agent is your best answer. However, you can go alone, but this is too big of an investment to "wing it" . Maria (below) was accurate. I think other than professional assistance, your best approach would be "all things being equal" . If all the recent sales were on the same square footage and same land sizes and same condition- what would the approximate price of the home be. How much more or less would the price increase or decreas based on average square footage. How much more for additional unimproved land( improved land is the land under the home containing utilities and driveway) extra acreage is unimproved. How does the condition compare to other homes and adjust for updates and repairs. I probably would get a third party appraisor or hire a realtor, but in the end a home is worth what you are willing to pay. Hope that helps.
0 votes Thank Flag Link Wed Aug 20, 2008
Have you looked around? Have you seen other homes? What do you think its worth?

Or

A Real Estate agent will get you close, a GOOD appraiser like Michelle Saye with Almost Home Appraisals at 678-591-8946 will not only get you a price but the appraisal will be so detailed that a bank might be able to use it in the event that you do make an offer.

The good news is that unless you are buying it with Cash, the home will have to be appraised anyway.

Good luck!
0 votes Thank Flag Link Wed Aug 20, 2008
Joshua Jarvis, Real Estate Pro in Duluth, GA
MVP'08
Contact
This is not an auction or foreclosure (at least not yet anway)
0 votes Thank Flag Link Wed Aug 20, 2008
Your realtor can assist you in determining fair market value for the home as well as helping you register for the auction and attaining an inspection of the property prior to auction. I always recommend that my clients get an inspection on the property, whether it be a traditional purchase, REO, short sale or auction process.
If you are not using a realtor to represent your interests, please read ALL of the terms and rules of the auction house carefully. Get an inspection done by an ASHI certified inspector. Go to the county recorder's office where the property is located and ask the clerk to assist you in identifying recently sold properties to determine a fair value. You will need to figure out $/sq ft, condition, and location and then make adjustments according to how the subject property really compares to those sold.
0 votes Thank Flag Link Wed Aug 20, 2008
Average price in the subdivision is about $150-200K less than the asking price for this home, that is based on one sold home that cannot compare nor has the amount of property. There hasn't even been more than 1 recent sale in the past year to make up an average. Which makes this very difficult and challenging. My conclusions, right or wrong: 1. Homes that are for sale are not selling in this area. 2. Foreclosures are affecting the sales of "on the market" homes. 3. People are asking way too much, even in a down market and despite dropping prices sometime $100-$200K. 4. This is a less desirable area compared to other areas in Acworth i.e. there is a reason for so many subdivisions.
0 votes Thank Flag Link Wed Aug 20, 2008
Hi Jeff,
I hope you are using a REALTOR and if not, please contact one to assist you and watch out for your best interest. If you need any recommendations, please do not hesitate to contact me.
Best of luck
Web Reference: http://www.torilawson.com
0 votes Thank Flag Link Wed Aug 20, 2008
Wow! If you have found all these items in the home than it might be worth pursuing , by all means. It is hard to pull comps with the acreage and such. Please let me know if I can help you further. :) vcellis@kw.com
0 votes Thank Flag Link Wed Aug 20, 2008
Jeff,

You mentioned that the home is "one of the biggest", but not necessarily the most expensive. If it IS the most expensive because it was overbuilt for the neighborhood, I'd strongly advise that you DO NOT pay much more than the average price in the subdivision. To do otherwise would make someone else's mistake your own.

If you're purchasing without financing, get an appraisal and make your purchase subject to that appraisal being equal or greater than the amount you have agreed to pay. if you're using a lender, ultimately, it's the lender's appraisal that will be the one that counts, and that will force an adjustment in the price.

Appraisals are coming in tight these days, and that's good. If the subdivision doesn't have sufficient comps to justify the asking price, consider that a warning. If the appraiser is liberal in their appraisal, you may end up buying a home that could turn out to be a poor investment. So, I can't say it enough. Be careful!

To answer your other question, "What is a fair offer?". I'd say, what you're willing to pay based on the information available to you. The seller has a right to ask whatever they want for their property, but it has to be based on more than their desire to make as much as they can. Make an offer that you feel is reasonable, support it with the facts as you see them, and be prepared to walk away if they won't accept reality.

Good luck!

Bob Engert
RE/MAX Greater Atlanta
770-592-3218
Web Reference: http://www.BobEngert.com
0 votes Thank Flag Link Wed Aug 20, 2008
Yes rule of thumb says never buy the most expensive home on the block, but there are one or two of the other homes should the buyers decide to sell, should list for more. Plus we are pretty particular, want a neighborhood but no HOA, want 2+ acres and at least 3 car garage, plus basement, want woods and separation from other neighbors and busy roads. We have not had much luck finding home that fit our wants and needs in Acworth. Seems like every subdivision has HOA or if it doesn't it's on a busy road. There are other comps in close proximity, but they have smaller lots and are in highly desirable golf course subdivisions (Bentwater) not sure it is a fair comparison.
0 votes Thank Flag Link Wed Aug 20, 2008
Hi Jeff,
I had the same exact problem with my listing in Acworth. So, I had my seller's get an appraisal done so we could accurately price it and gauge all the incoming offers. You may want to suggest that the seller's have an appraisal done. Regardless of the offer though, it will come down to how much the seller is willing to give up and if they are financially able to meet your request. Eitherr way, you will have to have an appraisal contingency attached to your offer to protect you! Your Realtor should know how to protect your interests. Best of Luck. :) Valerie Corpora-Ellis 770-262-8480
0 votes Thank Flag Link Wed Aug 20, 2008
It appears you are setting yourself up to buy the most expensive home in the area - which is not usually a good idea. How about looking for comps within a mile or 2, rather than just the neighborhood? If there truly are none, and you really want this home, have your agent help you do "adjustments" to the closest-to-comp values to come up with an offer. You do have a buyer agent to represent you, I hope, and aren't just using the selling agent.
0 votes Thank Flag Link Wed Aug 20, 2008
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