If a place is priced at roughly market value, what is a good offer? I'm looking at a place for 170k and wanted to offer 150K but my real estate agent claimed that would insult them and I need to stop with the "low ball" offers. Closing coasts in NY are around 10 thousand so i'm looking at around 160K even if they accepted the offer. Is she right? In my way of thinking i'd rather make 10 low offers and be rejected on 9 so I can get the one that accepts at a good price.
Asking price is irrelevant. The value of the property is what you are going off of. If the place is actually worth 120K then your 150K is doing them a favor. If the placed is really worth 220K then odds are they are going to ignore you. If you don't trust your agents judgement or know more about "market value" than she does, then find a new one or do it yourself.
Just my 2 cents and good luck
I agree with what the guys said, me and my partner walked away from an agent and decided not to work with them because they would be hesitant to pt in offers and decide to wait it out for us to think about the price we want to offer, so we would pass out on very good deals. If they are worried about hurting the sellers feelings then they do not understand the investor mentality, so you need to find an agent who also invests to understand what you are doing.
Your agent needs to work for you. Plain and simple. It is more likely that you agent wanted you to make higher priced offers because the agent gets paid on a % of the sale price.
Find an agent who already deals with other investors. They tend to be the smart ones.
Rather than focusing on price, how about focusing on terms. Back to your 150k example. If you are looking for cash flow then the price is less relevant than the terms. For example, if I made an offer of 200k for that same house but my offer included seller finance at $500 per month for something that would rent at $1000 (made up numbers) Then I would have a good cash flow property and the seller would get more than anyone else would offer. I can make this offer because the tenant will be paying the monthly, and I will have very little out of pocket. Note that I made no offer of a down payment, but you will have to pay the agent on a listed property.
I love creative finance almost as much as I love the money that comes with it.
To your success