Are You Ever Able To Make Listing Price Offers?

Question

It's really just a curiosity of mine as there's a property that I'm going to be making a offer just $5k below asking. Is this unusual? It makes me actually feel uneasy so I'm re-analyzing everything over and over. Perhaps you can share your experience and calm my nerves (or maybe make them worse!).

(This is a fix/flip deal on the MLS...)

Thanks,
-Manuel

(This is a fix/flip deal on the MLS...)

Thanks,
-Manuel

J Scott · Answer

Your offer price should have nothing to do with the list price.  In fact, I will often determine my max offer price without even knowing the list price.  Probably 10-15% of our properties we've paid over list price, with the most being about 40% above list.

There are lots of reasons a seller/listing agent will list their properties low, from ignorance of the actual value to attempt to get a bidding war.  Don't get caught up on the listing price -- just offer what it's worth to you.

Dell Schlabach · Answer

We do that frequently, and still typically lose out to guys willing to pay more. I crunch my numbers and know what I am willing to pay.

Last week house came on market for 43, 000, there was a seven day hold before the bank would review offers, day six we called to offer, 13 other offers in I offered 52,200. House sold for 60,000.

Right now I have two under contract that I I paid full price, came on good friday, 134,000, I was going to offer 10k less, realtor said they have no offers yet, but 17 showings scheduled in the next 48hours. She agreed to put it pending, cancell all showings if I put in full price offer. I did. I would have paid an extra 10k if I needed to, we expect to make 40k on it.

Another one multiple offers, on for 43k, psid 50,200. Easy rehab that should net, 20k

Last year, five out of 16 I paid full or above for them, all profitable deals, so if its a deal, dont sweat too much offering full price, a lot of rehabbers in our area are doing that, in order to be in the game.

Ps, 90% of our deals are mls deals.

Maybe this will help calm the nerves,

Hope you get a good one.

Manuel A. · Answer

The list price never really crossed my mind until I noticed how close to listing is to what seems a good offer on this HUD (scary...) house.

By the way guys/gals, I have another question...

Do you think I should actually put in this offer on this HUD house? I'm planning on going the HML route, but the scary thing is, what if they don't really follow through? I have two HML's which I've called and asked questions of, even got them to say they'll give me a proof of funds when needed, but I just don't have 100% trust in them, as I don't really know them...

Think I should go for it? I'm only going to be putting $1k EMD as that's the most I'm willing to lose to HUD if it falls through...

Thanks,
-Manuel

Patrick L. · Answer

List price is often just what one idiot thinks the house is worth, the actual value may be higher or lower than that.  Don't let the list price play into your decisions too much, just because you buy something at $50k below list price still doesn't make it a deal if the house was listed for $75k more than it was worth.

Glenn Espinosa · Answer

Basically listen to what everyone else is saying. Don't get caught up in the list price but instead offer only what you're willing to pay in order to make the deal work - no more.

Sometimes I'll see what 85%-90% of the list price is and if my offer is considerably lower I won't waste my time with an offer since houses in my area are routinely going for above list price nowadays.

Thats pretty much the extent of impact the list price has on my analysis.

Mike G. · Answer

It depends on the listing price, repair costs, and resale price.  Sometimes we offer significantly less than asking, sometimes significantly more.  We just do our estimates and offer what works for us.

Manuel A. · Answer

That was the perfect answer I needed! Thanks a ton Dell Schlabach!

-Manuel

Are You Ever Able To Make Listing Price Offers?

Most Popular Reply