Daniel Jeung

In my opinion, price reductions have no significance in making an offer on a home. However, Bryan has a good point in terms of the seller's mindset (unfortunately, what the seller thinks also has no bearing on the value of the home). To use an extreme example, let's say that a home is worth $500k but the seller prices it at $1mil. After sitting on the market forever, the seller reduces the home to $750k (a reduction of $250k), and a buyer comes along an makes an offer at $500k (still $250k less than the list price). The seller is insulted because he/she just dropped the price $250k. Realize though, that the value is still only $500k and the home is still over priced.

Bottom line: Base your offer on "sold" comparables, and don't pay any attention to the price drops or the seller's outrage (if indeed this occurs). Market value is defined as what a ready, willing, and able buyer is "willing to pay", and what a ready, willing and able seller is "willing to accept". If you have an unreasonable seller, then I suggest moving on to better things. The key here is to base your offer on something valid, not just a "whim" price that you want to pay.

Best of luck in your offer!

-Daniel - Tue Aug 26 2008, 12:03

Melissa,

Seattle is very similar to the SF bay area, but for the temperature extremes and rainfall. I think of it this way: If Seattle is SF, then the Eastside (Bellevue, Redmond, Kirkland, Woodinville) is like the Eastbay (only it takes less time to get to Seattle from the Eastside than it does from Walnut Creek to SF).

Depending on your price range, and tolerance for commuting, you can find affordable housing from the high $200k to over $1m. Like the Bay area, there are many choices. I grew up in Danville and found Woodinville very much to my liking up here.

Best of luck in your relocation!

-Daniel - Sat Aug 23 2008, 20:30

Yes, perhaps the financial market situation has made getting a loan more difficult for you in particular, but as with everything in life, it all depends on your perspective. While I don't necessarily agree with Jonathan below in that you are being "rewarded" (and I'm sure it was possibly stated "tongue in cheek"), he does have a good point. Several years ago, many other borrowers (probably in a similar financial situation as yourself) felt that they were well qualified, had sufficient credit scores, down payment, etc..., and became the happy recipients of an adjustable rate mortgage on a home they stretched for. Fast forward a couple of years to 2008, and Voila', look what happened.

Now, the lending institutions are returning to their conservative states and as a result, fewer borrowers can qualify (or as some would say, be put in jeopardy because they bit off more than they could chew). We as a nation, have become so infatuated with the lifestyles of the rich and famous, that we stretch way beyond our means. By this, I mean that we want the best of things right now instead of biding our time. Both of my parents had 6 siblings and grew up in small apartments, often doubling and tripling up in bedrooms. Nowadays, some families feel they need one bedroom AND bath for each person in the household.

Again, Jonathan makes a good point about inventory levels and interest rates. While I don't know your particular needs in a home, I would suggest reviewing your criteria and perhaps scaling back to a home size and price range that fits within the lender's criteria. It may not be the ideal home, or the home of your dreams, but what you will discover over time, is that no home ever is.

Best of luck!

-Daniel - Tue Aug 19 2008, 11:19

Julie,

First, I never like to "assume" but based on the statistical data for homes vs. condos (in general), homes do appreciate more than condos, but not necessarily for the reason that you stated above. I think that appreciation of a property has more to do with the desirability rather than the availability (i.e. more people want single family housing vs. condos). However, depending on the specific area, condos sometimes can (and do) increase more than individual homes.

My recommendation would be to find a property that you like (whether condo or single family home) and base your purchase decision more on your daily lifestyle (what do you want in a home, where do you want to live, etc) than the appreciation factor. As of right now, nothing is really appreciating anyway...

Best of luck in your home (or condo) search!

-Daniel - Thu Aug 14 2008, 22:22

K,

You stated that your home is vacant. Is it staged? I look at about 5 homes each day in Woodinville, most are vacant and look desperate. In addition to being priced "right", you also need to set the stage for buyers to feel comfortable in your home. Some agents may feel that price is everything, but in my opinion, it is only 90%. Staging and condition are the other 10%. If you're priced at the top of your range in terms of $/sqft, then your home better be the nicest (not only on the block, but in the neighborhood too!).

For some sellers, getting the home to that pristine condition and perfect price might not be realistically feasible, and so the price becomes the great equalizer. The activity in our area has been slow but should pick up as we approach the new school year. Buyers have choices, and most of the comments below are right on the money. Buyers are looking for "value", not necessarily the lowest price.

Best of luck in your move!

-Daniel - Wed Aug 6 2008, 10:21