How much Below asking should you offer when buying a house?

[mramseyISU]

So as the result of my wife getting loaded at our son's baseball game a couple weeks back while sitting next to a realtor I may be putting an offer in on a house in a few days. The house in question is being listed for just a bit under $400k but it was originally listed for $470k and that was just shy of 700 days ago so it's been sitting on the market a while. The zillow estimate is $382k but it's been a while since we bought our last house and I'm wondering what the rule thumb is if there even is one for making an offer on a house these days.

 

[chadly82]

So as the result of my wife getting loaded at our son's baseball game a couple weeks back while sitting next to a realtor I may be putting an offer in on a house in a few days. The house in question is being listed for just a bit under $400k but it was originally listed for $470k and that was just shy of 700 days ago so it's been sitting on the market a while. The zillow estimate is $382k but it's been a while since we bought our last house and I'm wondering what the rule thumb is if there even is one for making an offer on a house these days.

That long on the market at that price? Low ball the crap out of it to your payment range as much as you can. They've dropped 70K and its still been sitting that long, theres gotta be something in an inspection and theyre getting desperate I'd bet. Just make sure all bases are covered here is my advice!

 

[cycloneML]

should be able to offer 10% less without offending seller

 

[mramseyISU]

That long on the market at that price? Low ball the crap out of it to your payment range as much as you can. They've dropped 70K and its still been sitting that long, theres gotta be something in an inspection and theyre getting desperate I'd bet. Just make sure all bases are covered here is my advice!

I think the big issue for them is we have a 3 year tax abatement for new construction. That's making it hard to move a house that isn't new construction right now. The only reason I'm even considering it is the listing agent is putting together an offer just to buy me out of my house.

 

[CtownCyclone]

So as the result of my wife getting loaded at our son's baseball game a couple weeks back while sitting next to a realtor I may be putting an offer in on a house in a few days. The house in question is being listed for just a bit under $400k but it was originally listed for $470k and that was just shy of 700 days ago so it's been sitting on the market a while. The zillow estimate is $382k but it's been a while since we bought our last house and I'm wondering what the rule thumb is if there even is one for making an offer on a house these days.

Oh this sounds somewhat familiar...

We bought a house around that range that had sat on the market for a long time and was listed at quite a bit below market value. The twist was that it was from a corporate relocation, so we weren't dealing with people, we were dealing with the relocation company.

If you're dealing with actual people who own the house, they're probably pretty motivated to sell. The relo company just kind of didn't care too much about it, and we were crunched for time, so we didn't get to do too much haggling over it. We did close at something like 10% below the list price.

 

[chadly82]

should be able to offer 10% less without offending seller

Id def be offering 360K and then they can only counter!

 

[BoxsterCy]

No rules, all depends on the house, the neighborhood, the demand in that hood, and how realistic they have it listed for. Sounds like these folks were in the unrealistic realm. Is this a high demand area that was maybe driving their earlier fantasy price or are they just out of touch?

 

[BCClone]

So as the result of my wife getting loaded at our son's baseball game a couple weeks back while sitting next to a realtor I may be putting an offer in on a house in a few days. The house in question is being listed for just a bit under $400k but it was originally listed for $470k and that was just shy of 700 days ago so it's been sitting on the market a while. The zillow estimate is $382k but it's been a while since we bought our last house and I'm wondering what the rule thumb is if there even is one for making an offer on a house these days.

Either something is wrong with it or they screwed up and over listed it. If it has been on the market for two years, there is a serious problem with it. If you don't want the house, don't make an offer. I don't care if you wife got drunk and said something to the agent. Go look at it and find a reason not to offer if you don't want to burn the bridge.

Get the back story on it and go from there.

 

[CYdTracked]

I've always felt offer low but not too low to insult the seller and see just how far down off the asking price they will come on a counter offer. If they don't come down much there is probably not much wiggle room on price negotiation but if they come down a lot you know they are motivated to sell.

You say it was originally listed 70k more 700 days ago but has this house been on the market that whole time or did they take it off the market for awhile? The longer a house has been on the market the more likely the seller is motivated to sell but some people will also just put their house on the market during a hot market and if they don't sell will take it off for awhile and try again later so that price from nearly 2 years ago may not be in line with the current market either.

 

[Jer]

The worst they can say is no. For better or worse, we're on our 4th house in 15 years with the past 2 being new construction. We've always believed you go in respectable but low and have wiggle room. Given the fairly tight market, it's typically not going to result in much of a drop. However, if it's been on the market that long it is either really high or has a lot wrong with it. Either way, you wouldn't be out of bounds doing $360K to $375K to start.

 

[chadly82]

I think the big issue for them is we have a 3 year tax abatement for new construction. That's making it hard to move a house that isn't new construction right now. The only reason I'm even considering it is the listing agent is putting together an offer just to buy me out of my house.

Sounds like you may have a good opportunity here to really come out ahead to be honest. Just really work that price especially if you're not in a must move situation.

 

[BillBrasky4Cy]

That long on the market at that price? Low ball the crap out of it to your payment range as much as you can. They've dropped 70K and its still been sitting that long, theres gotta be something in an inspection and theyre getting desperate I'd bet. Just make sure all bases are covered here is my advice!

I can tell you that in the DSM Metro, inventory on the $400,000 - $500,000 is heavy and very stagnant. Houses aren't moving at that price point because people can build a comparable home for a comparable price. If you are looking at this price range make sure you are in it for the long haul because you won't build **** for equity.

 

[Dr.bannedman]

The worst they can say is no. For better or worse, we're on our 4th house in 15 years with the past 2 being new construction. We've always believed you go in respectable but low and have wiggle room. Given the fairly tight market, it's typically not going to result in much of a drop. However, if it's been on the market that long it is either really high or has a lot wrong with it. Either way, you wouldn't be out of bounds doing $360K to $375K to start.

hey jeremy can i be a mod for this website

 

[chadly82]

I can tell you that in the DSM Metro, inventory on the $400,000 - $500,000 is heavy and very stagnant. Houses aren't moving at that price point because people can build a comparable home for a comparable price. If you are looking at this price range make sure you are in it for the long haul because you won't build **** for equity.

haha you are correct. I'm a home builder myself....buyers are minimal in that range. Shoot even in the $350000-$375000 range.

 

[chuckd4735]

I can tell you that in the DSM Metro, inventory on the $400,000 - $500,000 is heavy and very stagnant. Houses aren't moving at that price point because people can build a comparable home for a comparable price. If you are looking at this price range make sure you are in it for the long haul because you won't build **** for equity.

This. The supply at this price point on most areas outweighs the demand. This owner may also not be too serious about selling. Ive seen this down with houses at this range, where the property owner will list it for a price they may sell at, and if they ever get that offer consider it, but they really are not super serious.

 

[SpokaneCY]

I've always felt offer low but not too low to insult the seller and see just how far down off the asking price they will come on a counter offer. If they don't come down much there is probably not much wiggle room on price negotiation but if they come down a lot you know they are motivated to sell.

You say it was originally listed 70k more 700 days ago but has this house been on the market that whole time or did they take it off the market for awhile? The longer a house has been on the market the more likely the seller is motivated to sell but some people will also just put their house on the market during a hot market and if they don't sell will take it off for awhile and try again later so that price from nearly 2 years ago may not be in line with the current market either.

We just bought a house in Colorado Springs (actually 2 but that's a story for another day) and when you find the house you want (talking about CoSprings and whatever under-supplied markets), you make a full price offer and hope it holds. We're actually seeing houses coming off the MLS and going back on for more money. Guessing the initial flood of full price offers clued the agents in that more money could be had!

Others have said but so many variables with markets and supply/demand.

 

[KnappShack]

should be able to offer 10% less without offending seller

Wondering if any offer could insult the seller after 700 days on the market.

Wonder why the home has been available that long and if the OP will face the same headwinds when selling

 

[chadly82]

This. The supply at this price point on most areas outweighs the demand. This owner may also not be too serious about selling. Ive seen this down with houses at this range, where the property owner will list it for a price they may sell at, and if they ever get that offer consider it, but they really are not super serious.

Right, the "how much can I really make, but don't absolutely have to move by any means" approach.

 

[CYdTracked]

We just bought a house in Colorado Springs (actually 2 but that's a story for another day) and when you find the house you want (talking about CoSprings and whatever under-supplied markets), you make a full price offer and hope it holds. We're actually seeing houses coming off the MLS and going back on for more money. Guessing the initial flood of full price offers clued the agents in that more money could be had!

Others have said but so many variables with markets and supply/demand.

It's all about the market at the time and price point at a given time. The longer a house sits on the market usually the price comes down to an appropriate value. I remember when I was in the market for my first home before I viewed 1 property my agent told me they had already turned down a full price offer and were waiting for their new house to be built so if I bought it they had terms that we couldn't close for at least 6 months too. It was a pretty hot market at the time as some homes I wanted to view were off the market in just days after they were listed before I could view them so thought it was odd for someone to turn down an offer for the listing price if they were ready to sell now. After viewing the house I wouldn't have offered full price based on location and how the floor plan compared to other homes I was looking at the time so I wonder how that owner made out in the end.

My uncle used to own a realty company so always appreciated his advice when I was buying or selling. One thing when interviewing agents to sell your home the 1 that gives you a much higher price than the other agents you talk to probably has unrealistic expectations for the value of your home and will ask you to drop the price after you get little initial interest. They get your hopes up with that higher price to get you to sign with them. The ones that present you with good relevant market data and a price point in line with that usually sell homes the quickest. Asking what their average days on market for their listings was one of his key questions and I remember liking everything about 1 agent I interviewed when I sold my last house up until when I asked her that question and she stumbled and didn't have an answer for me while everyone else I asked didn't hesitate to answer.

Housing market is just as slimy as the used car market. Lots of people in the business who will do anything to make a sale even it if isn't in your best interest. Do your research and don't be afraid to back away from a deal you are not comfortable with.

 

[mramseyISU]

Either something is wrong with it or they screwed up and over listed it. If it has been on the market for two years, there is a serious problem with it. If you don't want the house, don't make an offer. I don't care if you wife got drunk and said something to the agent. Go look at it and find a reason not to offer if you don't want to burn the bridge.

Get the back story on it and go from there.

I think the biggest issue is for the same money you can build a house and get that tax abatement 5 blocks away. Most of the houses in our neighborhood have taken 4-6 months to sell in the last couple years because there is a new development going in a 1/4 mile away. They are selling a few lots over buy this house in question and they are all going for $100k. We went and looked at it last night and really like it. Basically it's going to come down to two things, what the realtor wants to give us for our house and if we can get it down to somewhere around the zillow estimate or below.