As someone who has represented dozens and dozens of buyers in REO transactions, and as someone who has also personally purchased REOs, I think I may be qualified to respond to this one.
I predict that the REO listing agent will not provide any assistance or recommendations in helping determine price. They will simply state that you should submit your highest and best and then wait to see what happens. IF they respond to your agent at all. Donâ€™t count on a response.
If you are offering $40,000.00 under asking, you can expect a few things to happen:
(1) They may totally ignore your offer and not respond.
(2) They may counter back very close to asking price.
(3) If another offer comes in while you are dickering, all bets are off and you will have lost any advantage. They will no longer negotiate, they will simply send out a multiple counter and ask for your highest and best.
I want to highlight some comments from below:
@Barry: â€œTypically, the condition of the property is already factored into the list price â€¦â€
Correct. Theyâ€™ve already done a few BPOs and will have looked at dozens of graphic pictures detailing property conditions BEFORE setting the price.
@Janis: â€œAlso, if REO price is much lower than comparables to begin with, then you could be facing competition on your offer.â€
Donâ€™t know your market, but that is certainly the case here in this market.
@Steve â€œRather than relying on the opinions of this forum regarding an unidentified property, you should be using the "gold standard" of determining pricing trends -- a Comparative Market Analysis (CMA).â€
TOTALLY agree. Itâ€™s the only way to effectively determine price. Not the opinions of this forum.
@John: â€œWhat advice did your agent give to you?â€
TU. You need to be talking to the boots on the ground in your area.
Here are some posts that may be helpful:
Top 10 Things I HATE About REOs: AND 3 Startling Consequences
How To Buy An REO â€“ Top 17 Questions Answered
What Do REO Lowball Offers Have In Common With Tyrannosaurus Rex?
The Death of Negotiation: Top 5 Consequences
Wanna Buy An REO? You MUST Watch This ...