Realistic Offer for A House

7 Replies

As noted in the description and title, I am interested in buying a 1985, 3 bedroom, 3 bathroom 2,965sq ft brick house on 1.20 acres. 1 acre in the city limits runs around $15-25K as there is a small 1 acre lot left. It appears to be in very good condition and it is in a small city of 11,000 people. They are asking $279,900, reduced a month ago from $283,000. Right now where we are at, it's a sellers market and most houses sell within 20 days; this house has been listed for 68 days. The sellers have also told our buyers agent that they are "motivated sellers". My question is, what offer would be appropriate? My buyer's agent said to offer $260K, I was thinking more along the lines of $250K as I know we will work our way up toward $260-$270. Also, 250K is roughly an offer of 10.7% lower than the original asking price of $283K. I don't think 10% is an absurdly low-ball figure but with the property being on for 68 days without a single offer, I think it is a fair offer/starting point. I'm hoping to get it for $260K

This is almost an impossible question to answer.  So many factors go into this....actual value of the house, negotiation style of the buyers agent, negotiation style of the listing agent, what the factors in it not selling are, what the sellers motivation is, what their personalities are like, what the market customs are.

You bid too low, you insult someone and they will just choose not to sell to you. You go to high, and you leave money on the table.

With all that being said, $250k doesnt sound crazy as a starting offer, but nor does $260k either.  Also something to keep in mind, sometimes sellers get focused on what I call the front side number...(price) and less focused on the backside number, the net price.  So I often try to put some closing cost help in the offer, both to lower my out of pocket expenses, and because often its easier to get a couple grand there on the backside than on the front side.

Hello Tou, thanks for the post? What is the comps for the property in that area? If its in the market for 68 days and no body else is making an offer I will say do your due diligence and find out if there is issues on the property. If you find out and everything is fine you can offer 250000 and I will put some home inspection contingency to protect myself

Originally posted by @Adekunle Ilori :

Hello Tou, thanks for the post? What is the comps for the property in that area? If its in the market for 68 days and no body else is making an offer I will say do your due diligence and find out if there is issues on the property. If you find out and everything is fine you can offer 250000 and I will put some home inspection contingency to protect myself

It's around the same value, not sure why there hasn't been an offer yet. So far everything has checked out, I know the current owner refin the house in 2014 for $30K. The house has had two owners with the current owner having owned the property since 1994. And yes, the contract offer will have a few contingencies such as termites for a part of the house as well as a home inspection. The only downfall is it's on a fairly busy residential street where the speed limit is 45mph with most cars going 50ish.

Originally posted by @Russell Brazil :

This is almost an impossible question to answer.  So many factors go into this....actual value of the house, negotiation style of the buyers agent, negotiation style of the listing agent, what the factors in it not selling are, what the sellers motivation is, what their personalities are like, what the market customs are.

You bid too low, you insult someone and they will just choose not to sell to you. You go to high, and you leave money on the table.

With all that being said, $250k doesnt sound crazy as a starting offer, but nor does $260k either.  Also something to keep in mind, sometimes sellers get focused on what I call the front side number...(price) and less focused on the backside number, the net price.  So I often try to put some closing cost help in the offer, both to lower my out of pocket expenses, and because often its easier to get a couple grand there on the backside than on the front side.

 Thanks for the response, I do understand how this, and questions like these, are near impossible to answer accurately as there are many variables to consider. I appreciate the honesty in your response and that was something the agent said as well, about a $260 offer with the seller helping with the closing costs. 

Originally posted by @Tou Yang :
Originally posted by @Adekunle Ilori:

The only downfall is it's on a fairly busy residential street where the speed limit is 45mph with most cars going 50ish.

DING DING DING DING DING

That is exactly why it has not sold yet.  Houses on main streets (except maybe in the hear of major cities) always are going to be harder to sell than other houses.  They will always take longer, and should almost always sell at some sort of discount to houses in the neighborhood not on the major street.

Originally posted by @Russell Brazil :
Originally posted by @Tou Yang:
Originally posted by @Adekunle Ilori:

The only downfall is it's on a fairly busy residential street where the speed limit is 45mph with most cars going 50ish.

DING DING DING DING DING

That is exactly why it has not sold yet.  Houses on main streets (except maybe in the hear of major cities) always are going to be harder to sell than other houses.  They will always take longer, and should almost always sell at some sort of discount to houses in the neighborhood not on the major street.

Yes, it is a slight concern as the house is at the top and the front slopes downward at a fairly steep decline toward the road. From the road to the front steps is approximately 150feet so it's a good distance but we've thought about a ball rolling down toward the street and our little one running after it. Of course we will not allow our two girls to play in the front but being a kid, I know I found ways to do things I wasn't supposed to do so it is something we have considered and factors into everything as well.