How do you kmow if its the right offer?

10 Replies

After inheriting quite a bit of rental properties (both commercial and multifamily), my brother and I have decided to sell the family home that my parents bought in 1962. So I spent the past 3 months or so, having a huge estate sale and then still going through more stuff in the house (I couldn't believe how much "stuff" was in the cupboards). I finally got over the emotional distress of selling this house and it went on the market last Tuesday. As of right now, we had two offers that were lower than we had hoped. One offer from a family that lived near there and wanted to move right in. The other offer is from investors and higher. $950k, we countered to both for 1 million. Appraised at 1.1. Anyways, the family backed off. After emptying the house, I realized that it really needs tons of work. Although my folks made this a beautiful unique home, they did that over 30 years ago. It not only has a lot of repairs needed, it really needs to be updated.

So the investors came back at 960k. My agent thinks we really should take the 960 since it does need the work, and he is afraid that if wait too long, the investors will back off and we may not get an offer that high?  

Just wondering, should we go back and counter at $975k? That's what my brother wants to do. Me? I would probably take the 960K. I am ready to see it sold. Plus with the inheritance, we got a negative bank account, due to our sister keeping all the cash for herself. I'm ready to put the money into some of the neglected buildings we have now, and then clearing up my credit and purchasing more multifamily properties. 

And, by the way, we are selling it as is. We only have a $50k mortgage on this property, all the other properties are paid for, Thank you dad! RIP

Why jump over dollars to chase pennies? You got two offers and one is already off the table. An appraisal is not an exact science, especially when you are  talking about a 1mil property. 

@Drew Vukov  Said it all.  Take the offer.  You're spinning your wheels over pennies with "zeros".

Joe Villeneuve
REcapSystem
A2REIC

@Sheri Fierro  I would get some better info on how much repair really needs to go into the property. And, looks like I'm in the minority, but I think the 15k difference is significant and if it is worth that plus in a hot market then I would stand strong. Just list out the reasons why it's worth that amount - if the current buyers don't buy then someone else likely will. 

Originally posted by @Drew Vukov :

Why jump over dollars to chase pennies? You got two offers and one is already off the table. An appraisal is not an exact science, especially when you are  talking about a 1mil property. 

 That's my thoughts too!

I think @Drew Vukov  is spot on!  Get this one off the books and use the funds to tie up loose ends and grow your business.  15%k is just a small % on the overall purchase price, and with only 50k in loans, what a good place to be in!

I would sell it for the 960k and move on.  That's only 1.54% off the 975k you wanted which is a good deal for both parties.  I'd put more effort into where to invest the funds once the deal closes.  


As for the theory that other fish will eventually come along and take the bait.  It may be true but time equals money and who says the next person will see any more value in the property than the other people who have offered.  This is about money management and if you can pay down debt or invest the money for a nice return then you are a wise person.

I have to agree with the others....sell it.

I see heirs all the time that try to squeeze their inherited property at first.  Then they lower the price, lower it some more, then lower it still more.  I'd say just get rid of it, that $15K in the scheme things is not going to hurt you at all.  You have other places to go with the money that can create more income for you.

And yes, you can definitely thank Dad for all those free and clear properties.  A wise man indeed.

NEWS FLASH!  The L.A. Market has crested in most places. 

You ever hear the old stock market phrase: "Bears make money and Bulls make money, but pigs get slaughtered" ?

Not suggesting that you are greedy; just planting something to noodle on.

I've watched the same thing happen. Property listed for 120k I offered 110k. They wouldn't budge so I got wrapped up in another deal. They eventually accepted 100k. Lost 10k chasing a illusionary 10k that never existed.

Originally posted by @Rusty Thompson :

I've watched the same thing happen. Property listed for 120k I offered 110k. They wouldn't budge so I got wrapped up in another deal. They eventually accepted 100k. Lost 10k chasing a illusionary 10k that never existed.

 Thx everyone..... looks like $970 is the right number and a 25 day escrow.... As is...   I am happy. And, once sgain, thank you dad. What a great smart man he was

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