What are the must ask questions to come up with an accurate asking price?

Question

Greetings,

Hope all is well.

I am a new RE investor. An opportunity has came about. A friend is moving away and is interested in entertaining my offer price.

I quickly set up an appointment to go see the house this coming day and I would like to be educated on the key questions that I need to ask him in order be well informed of the most critical aspects of the house to finally come to an offer price.

Hope this message finds you all well.

Blessings,

Ray Hage · Answer

There's only one real important question. What is the general market of buyers willing to pay for this house? That is what most would consider to be the "fair" price. To get you to that prices, you'd want to know the age/condition of the AC units, electrical wiring and panel, roof and plumbing. Same goes with the fridge and Oven (though not as important). You also need to see if the house has been updated vs original (like does it have 1970s pink tiling in the bathroom). Finally, you could perform a CMA on it to see what a similar house would go for in that neighborhood.

Carlos Ptriawan · Answer

Mathematically speaking, house price depends on :1. location2. time3. condition4. supply and demand ratio5. the bid

A house in particular block usually has range between $A to $B ; the low range usually less updated and B is more updated. However, these number usually very dynamic moving up depending on supply and demand ratio and the eagerness of buyer to place a bid.So what you need to find out is the range first, and then you match with location and given time to know the exact value. Usually, home price is moving up between February to June. And stagnant after July.

The supply and demand ratio can be measured from statistical analytical calculation.

Jaron Walling · Answer

It's not that complex. "the key questions that I need to ask" - You already know the motivation so that solved it's self. YOU need to the know the market, what houses are selling for, and after walking it a general estimate of rehab costs. Factor in the above items and create a realistic offer in your mind.

Try to get a number from the seller first. You'll find out pretty quick if it's his first rodeo. If your mental offer (number) is WAY OFF, there's a strong chance this isn't a good deal, or maybe he's entertaining other offers. Consider your exit strategies before you make the offer. Investors make money on the buy side. You only get one chance to set the boat anchor.

Luis Maqueira · Answer

Agree with Ray,

There's only one real important question. What is the general market of buyers willing to pay for this house? That is what most would consider to be the "fair" price.100%  the market is going to dictate the price if you want to sell for less you always can.

You need to do your market analysis of the best price you can get for your friend for the property.

Good Luck.

What are the must ask questions to come up with an accurate asking price?

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