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!
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.
Michelle, I hope you put your offer in contingent on an appraisal, because a bank will have no problem finding comps.
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.
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.
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
CENTURY 21 Shirley Hooks, Inc. - Acton Office