Home Buying in Los Angeles>Question Details

S, Home Buyer in Long Beach, CA

Want advice about assessing a fair offer. I'm interested in a home I found in Lakewood, it was last

Asked by S, Long Beach, CA Tue May 20, 2008

purchased
in 2001 for about $220k, and it looks like some substantial renovations have been made (it's a beautiful home). It's 3bed/2 bath, 1154sq. ft house and 5100 sq. ft. lot. They're asking $499K, I'd like to offer at the most $425K, is this unrealistic that they'll accept?

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14
The best thing you can do is hire a buyer agent from your area. Your agent will give you all this information and It will be correct!
1 vote Thank Flag Link Sat May 31, 2008
Hello S.

After looking at some sales comps, $425 is an excellent offer. There are houses much bigger than 1154 sq ft, up to 1500 sq ft, that have sold for $450k in the past 2 months. If you would like any further assistance getting a great deal on a nice home, please feel free to call me anytime at 310-350-4280

Jimmy Hutchinson
Atmosphere Realty
1 vote Thank Flag Link Tue May 20, 2008
You can search the MLS for free at my website http://reolicensedspecialist.com/
I am a Real Estate Broker (over 20 years) specializing in Foreclosures. I Know Lakewood very well--if you are not happy with the service your agent is providing--fire her and give me a call.
0 votes Thank Flag Link Fri Jun 6, 2008
If the seller owes 450k and your offer is 425k, then it most likely will be a short sale (unless the seller is willing to pay the bank the difference to get out of the house). However, the bank may not accept your offer at 425k because after the all the closing cost are paid, the bank will net less than 425k.
0 votes Thank Flag Link Fri May 30, 2008
S, I would suggest that you and your agent sit down and look at the factors below prior to coming up with the offer price:
1. Comparative Market Analysis within a 1/4 mile radius of the home for the last three months
2. Inventory of homes on the market in the area now.
3. Absorption rate, i.e. how many homes sell within a particular period.
4. Days on the Market for the existing inventory
5. Market trend analysis - is the market going up or down and how quickly.

Only then, you can come up with a fair offer price. How much the seller paid or how many loans they have doesn't really matter.

Good luck!
0 votes Thank Flag Link Fri May 23, 2008
I spoke with my agent and she found out this seller owes about $450K from first and additional mortgages. For this reason, it isn't likely he'd accept my offer unless he was willing to consider starting the short sale process. Is this right? Also, is this worth considering or just go looking for a house without so many complications?
0 votes Thank Flag Link Fri May 23, 2008
Hi S,
It also depends on a few other factors like how motivated the seller is and how long its been on the market. If its been sitting on the market for a while, you may even have a chance at a lower price than 425. I would start at 410 and work your way up. They can always come back and counter with a higher number then it may be something you are ready for..maybe not?? I must add that about 3 weeks ago, our client offered 150k less than asking price. He was not the highest offer, but his offer was accepted beacuse he was the best offer, meaning he was ready to move and close escrow the fastest..its more like a bird in the hand is worth two in the bush!

Either way, in this market, you have nothing to lose, if you are ready to move, to make an offer.
Good Luck to you
Lou and Alex
LA Real Estate Group
info@myLARealEstateGroup.com
http://www.myLARealEstateGroup.com
0 votes Thank Flag Link Fri May 23, 2008
Thank you all, that's very helpful! It's not a short sale (as far as I know). And, I do have an agent (thank you all for your offers to help), but I've told her I wouldn't be ready to buy for another four months since we're trying to keep saving as agressively as possible. But, this home really caught my eye and I might be willing to gather our resources sooner than planned. I was just afraid if I lowballed starting at around 400-410K knowing I was willing to go up to 425k, that they would never take me seriously, but it sounds like given the market conditions this wouldn't be that much out of line. I'll keep pondering...
0 votes Thank Flag Link Tue May 20, 2008
I'm assuming that you have an agent and that your agent has provided you with comparables. That being said, most seller's in today's market (although they don't want to tell their agent) would like to see any kind of offer. How are your terms? Quick close? Preapproved? Short investigation contingencies? These are other factors that a seller could use to determine how good your offer is. In my experience, I've rarely seen someone accept an offer on the first try so start a little less than what you are willing to pay then keep your fingers crossed.
Ken
0 votes Thank Flag Link Tue May 20, 2008
Hi S!

Writing an offer requires investigation of public tax records.....AND A WHOLE LOT MORE!

Is it a short sale??
If so, R-U-N!! average market time.......10.67 months.....I'll explain why!

Is it an REO??
If so....LOOK HARD...average market time 1.85 months....I'll explain why!

What is the sold price per square ft nearby in the last 30 days??
This figure is vital when computing an offer......I'll explain why.

Does the owner have any equity??
Another critical factor in determining the seller's ability to deal!

What is the motivation of the seller??
Why searching public records can be the key to getting a deal!

Will the seller pay points to buy down the interest rate on your loan??
This allows you to have a lower payment OR allow you to buy MORE house.

Is it a family trust??
Why this can be another key to finding out the seller motivation??

Is the home sold as-is??
Important consideration when writing an offer!

Is the seller in denial about today's market??
A key in deciding whether to waste your time or not

If you would like answers to these and other important question contact me directly @ 714-365-6135

It's NOT about how much under the asking price we can go on a property.........It IS about how much can we go under the asking price on the RIGHT property!!! and GET IT!

Let me know how I can help.

As a courtesy, I would like to Email you listings that match what your looking for AND set you up to receive NEW listings the VERY SAME day that they hit the market!!........All based on your criteria.

Kurt @ Century 21 Orange County
714-365-6135
kurt.century21@yahoo.com

FREE Do-It-Yourself OnLIne Property Searches: http://www.officialochomesearch.com
0 votes Thank Flag Link Tue May 20, 2008
That is fair. If you are working with an agent, have your agent run a cma to see what it's worth. Also have your agent communicate with the listing agent to see if it is worth making that offer and will you be countered or are they willing to pay or closing cost.
0 votes Thank Flag Link Tue May 20, 2008
I also agree with the two realtors above. Around 10-15% under asking is in general a reasonable offer in this market. Although, the best way to asess your offer is to look at how realistic the asking price is to current comps (I would only go back 3 months in this volatlie market). A realtor can assist you with this the best and is very helpful in negotiating once you make the initial offer.

It is very often the case you will get countered back at a higher price than $425,000....other factors to consider are what does the current owner owe on the house, have they re-financed? etc.

Please contact me through my website below if you need any further assistance.

Sincerely,
- Jeffrey White -
323-251-2296
0 votes Thank Flag Link Tue May 20, 2008
IHi there S. I think you should try to get the best deal. possible. If you would like a porfessional in yiir corner working for you please let me know. Have you the most recent comps?
Kind Regards
Michael Barron
First Team Real Estate
(714) 552-6817
0 votes Thank Flag Link Tue May 20, 2008
I believe your offer is well within the acceptable range, these days it is NOT uncommon to see offers which are 15% below the asking price. My advice would be to have your REALTOR (i'm assuming you have one) negotiate on your terms and get as close to your offered price of $425,000. The market is still adjusting down about 1% per month. So, you would be wise to make a low offer.

If you don't have a REALTOR, I would be more than happy to assist you. You can reach me at 562-787-1101. I would also need the address of the property to do a thorough market analysis for you.
0 votes Thank Flag Link Tue May 20, 2008
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