Home Buying in Weatherford>Question Details

Michelle, Home Buyer in Weatherford, TX

What if there are no comps?

Asked by Michelle, Weatherford, TX Sun Apr 13, 2008

We just made an offer on a house that is truly unlike any other and I'm wondering what the sellers will think. I wanted to have some research like a comp, and I have researched a lot because there are no comparable homes in the area (or the zip code, really). In reality, our offer was at 88 - 89% of list price. It seems reasonable to me...

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Again, I agree with Jackie. It's a shame that you've had a bad experience with a REALTOR. I truly believe that most of them have a driving desire to do what's best for the clients. However, I also know that there are some bad ones out there. I wish you the best and hope you find a home soon.
3 votes Thank Flag Link Mon Apr 14, 2008

I am a Realtor here in Weatherford, and lucky for me, my husband is a real estate appraiser. So I have the added benefit of his knowledge as well as mine. I guess my question is how did you proceed with making an offer without knowing an approximation of value? Your Realtor should have provided you some info regarding this matter. Now if you made the offer yourself, without the use of a Realtor, then that's another story. Basically (and this is very basic), you need to be looking at the square footage, the location, the comps that have sold most recently that are close in size, age, and amenities. Never use a comp that has sold more than one year ago, and always try to use the most recent sales, as they are the best indicators of value. If there is nothing close by, then you will have to expand your search criteria and make adjustments. This is where it gets tricky. The listing agent for the seller should have provided comps to the seller (known as a CMA) to help them come up with a listing price. You definitely don't want to overpay because you could then become upside down on the house. Let me know if I can help in any way. Thanks so much and Good Luck!
3 votes Thank Flag Link Sun Apr 13, 2008
There should be comp's for the area, if not you reach a little further out.... NOW if an odd situation has happen during my years of experience I have it listed in special provisions that the seller and buyer agrees on sales price from the appraised value of the property from a certified appraisal. Therefore it settles all problems.

Good luck
Web Reference: http://www.lynn911.com
3 votes Thank Flag Link Sun Apr 13, 2008

The contract forms promulgated by the Texas Real Estate Commission allow that the lender must be willing to lend on the property. In most cases, the lender won't lend if it doesn't appraise. Ask your agent about your particular situation.

Last note* The bank doesn't find comps. The appraiser does and they often call agents for help. Sometimes you have to back into value. Such as separating the land from the house or looking for like neighborhoods/cities as opposed to something within a mile radius.
2 votes Thank Flag Link Mon Apr 14, 2008
Well Michelle, it seems like you tried to do your homework. I am sorry that you had such a bad experience with your first agent. I assure you that most of us agents are not like that. If you don't mind explaining, what makes this house so unlike any others? That might help us to help you more. As I mentioned before, my husband is an appraiser and we might be able to help you with finding comps (if you still want help.) Just let us know. You can reply on here or go to our website and send us the info. Thanks and we wish you much success!
2 votes Thank Flag Link Mon Apr 14, 2008
Michelle, are you playing Junior Agent? You stated that you have done a lot of research? This is the age of the internet, but you can't rely on what you read on Zillow to substantiate your estimate of value! You never mentioned what your REALTOR said??? Strikes me as suspicious! Trulia is not the place to save yourself money when you are trying to buy a place, its more useful as a agent check website in case you have any doubt! You can't check yourself if your not an Agent and you can't hold anybody liable if you are wrong! If you do insist on DIY, call Jackie! At least she will know that she can simply go to the listing agent and ask for the comps of the area they used to price the house. At least then she could save you the time of chasing comps.
2 votes Thank Flag Link Mon Apr 14, 2008
I get two thumbs down for making a good point? Yikes! Now, the only reason I say that Michelle is two fold. First, I am weary of disloyal buyers. Second, If you look like a buyer in distress then you are going to get superhero answers! You get theses answers from average Realtors, much like your first Realtor, that are pointless and hold water like a colander. However, if you tell everyone that you have been working with two Realtors on a home, non of which can find comps, that puts the question in a much different perspective. Would you agree? Only trying to help...Paul in Austin.
1 vote Thank Flag Link Mon Apr 14, 2008
Michelle, I'm sorry you weren't happy with that agent, I'm always surprised to hear someone doesn't return a call for days, I have a coronary when someone leaves a message on my voicemail at the office which has a message NOT to leave a message there but call my cell. If I were unreachable for 4 days I hope my clients see if I am lying on the basement floor dead.

Michelle, I hope you put your offer in contingent on an appraisal, because a bank will have no problem finding comps.
1 vote Thank Flag Link Mon Apr 14, 2008
This is Michelle - the buyer - and yes, we have a buyer's agent, although he came onto the scene late because our first agent was nowhere to be found when we were ready to offer (we called and emailed them repeatedly over 4 days). The first agent had trouble following through, but said she couldn't find comps. The new agent (different company) said he couldn't find comps. I think our situation is very unusual. Our offer was reasonable to the first agent, the second agent thought it a little low, but was new to the situation. He did not suggest any different.

As for me, I don't tend to take it for granted that anyone knows everything or has my best interests at heart, so of course I did research. I gave up chasing comps. That's why we made our offer. And I wasn't trying to "save money" on Trulia, I was wondering what someone else would think, whether 88-89% seemed in the ballpark. I have decided that it is a reasonable offer, and we will see what happens. Thanks for the help.
1 vote Thank Flag Link Mon Apr 14, 2008
It's not unusual to have difficulty finding comps, especially when the need to evaluate the value of a custom home or rural property comes up. If this is the case, none of the answers thus far will help. In the area in which I work, custom homes generally run from a low of about $1/sq ft to nearly $2/sq ft.

High-end homes are another matter. How can you put a price on a home with an Italian marble exterior! Putting a price per sq ft on them is almost absurd. It is not uncommon for them to be offered at a much higher price than the seller expects to obtain, nor unreasonable to offer 88-89% of the list price--or less. Their value is a matter of personal, esoteric considerations.

If the home you are querying about is not a multi-million $ property, you should ask yourself whether you would consider an offer that is 12% below your asking price reasonable if you believe that your home is reasonably priced. An offer that is that far off the mark can end negotiations with the first rejection.

If you found this home on your own, let this be a lesson. The listing brokerage and its agents owe you nothing more than fair treatment and an honest deal. They owe their client their best effort to obtain the best possible price, and they cannot advise you in a manner that may compromise their client's best interests. You should have retained a buyer's agent. A good agent would have been able to advise you about the home's value.
1 vote Thank Flag Link Mon Apr 14, 2008
There should always be comps or there are other approaches you can use such as cost method and work into it. What does your realtor say? What will your appraiser say? If you don't have comps how do you know how much to bid?
Web Reference: http://www.teamlynn.com
1 vote Thank Flag Link Sun Apr 13, 2008
Bruce Lynn, Real Estate Pro in Coppell, TX
Well if you just made the offer, see how the sellers come back. If they reject the offer, that normally means in their mind that you are WAY off. If they counter, see how they counter. If they counter close to asking, that normally is a sign that they aren't going to budge off their asking price that much. If they counter closer to your offer, you may have a good chance at possibly either getting your price (or close) or meeting them in the middle. However, your agent (if you are working with one) should have a formula to come up with comparables (even if they don't match this unique home) to come up with a good price for you. They would have to do this to list the property, so they should be able to do this to help you purchase the property as well.
1 vote Thank Flag Link Sun Apr 13, 2008
That was what I meant, Leigh. The bank's appraiser will have no problem finding comps. According to an agent on another thread, apparantly there are states that don't allow the agent's input. Mine does.
0 votes Thank Flag Link Mon Apr 14, 2008
Hi Michelle.

Are you working with an agent? If so, you're Buyer Representative should have done the research for you. The agent will know the value. Also, know that in Parker County the average sale price is 97% of list price. Of course, that is with sellers who have representation. If you are looking at an unrepresented seller, they'll probably be glad to get an offer that is at 88%.

I've been selling in Weatherford since 1996. I was REALTOR of the Year there in 2004. If you don't have an agent and have questions for me, feel free to call, text or email.

Leigh York ABR, CRS, GRI
Licensed Broker
CENTURY 21 Shirley Hooks, Inc. - Acton Office
0 votes Thank Flag Link Mon Apr 14, 2008
There are always comps no matter what the subject property is. Before you made the offer you should have consulted with an appraiser for a consulting assignment (not necessarily an appraisal) to provide valid comps and data to help you in determining an offer price. If you are working with an agent, they could provide their opinion as to an offer, but an appraiser would have provided info more in line with what your lender would receive when they order a full appraisal. If the seller does not accept your offer you can still consult with an appraiser for a different offer.
0 votes Thank Flag Link Sun Apr 13, 2008
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