Baldurr

Prices are so high for starter homes because there are so many programs that
let first time buyers start out with little if any down payment after they recieve DPA,
down payment assistance, which are govt programs such as CASA. These
programs are run by the local housing agencies, or sometimes by the state
housing agency in rural areas.

The unfairness of it kicks in when someone has been doing the old fashioned
thing like saving for a down payment. If you have liquid assets beyond a certain
amount, $4K in MN, then you no longer qualify for the govt DPA. Call it the penalty
for behaving responsibly. - Tue Mar 3 2009, 19:16

The question you should be asking is if $400K is way too high.
In most markets RE prices are in a state of collapse. If $459K
was the bubble price, the an offer in the $300K range should
be more than fair. Since this seller is obviously both a fool
and delusional, you should check into his situation. What are
the terms of his outstanding mortgage? How soon till his
mortgage resets and he can't keep up the payments? His
mortgage is a matter of public record, and these things are
easy to find out. Another approach would be to start out the
conversation by asking if he is willing to begin negotiating
a short sale. That just might shock him back into reality.
Remember, stock prices are back down to 1997 levels.
You should not be buying any real estate above the
1997 price. - Tue Mar 3 2009, 19:09

From the way you phrase your question, it sounds like you have
made the mistake of expecting that the agent representing you
will negotiate the best price on your behalf. One of the dirtiest
secrets of the RE industry is that agents are completely loyal
to the industryfirst, and generally regard buyers as ' cows to
be milked'. Since your ' buyers agent ' knows how much your
mortgage approval is for, the agent feels entitled to assume
that spending the full amount is in the best interests of the
industry, and the buyer will come out all right in the long run
anyway, since RE can only go up. haa haa

You might want to ask the agent representing you where
they attended school and what type of degree they earned.
And if they don't have a degree, what makes them such an
authority on property values!! - Fri Feb 27 2009, 21:18