New House and Pixie Dust Needed (Update on the 1st post))

[DVC Sadie]

We just put in an offer today for a house that is perfect for us and I am now nervous about the owners accepting our offer. The offer was about 5% less than the asking price so I am wondering if I offered enough.

If anyone who has bought a "previously owned" home please let me know if my offer was reasonable.

TIA, Sadie




We just got a call from our agent and we got the house. Thanks everyone for the pixie dust, good wishes and advice.

 

[JuneChickie]

WEll , it actually depends on the price of the house ,,, if its a hundred thousand dollar home and you offered 85 ,, might be a tad to low ,, but if its
a 400,000 home , then its a pretty good offer ...

Heres some pixie dust for you ,,, I hope you get it ,,,,
Buying a new home is always exciting ,,,, wish we could too ,,

and alittle extra just in case

 

[DVC Sadie]

Bumping

 

[luvdzne]

When we put an offer on our house the owners came back saying they were insulted, so we told them to never mind then we would keep looking not too long after that we got a call that they would take our offer .

It all depends on what other houses are going for in that area, how long it has been on the market, and if the owners are in a hurry to sell.

Good luck though, I hope they accept your offer! Here's some pixie dust

 

[Rock'n Robin]

If they are insulted they may make a counter offer, and then you can make another counter-officer if you feel you can spend a little more. Rarely does a seller just tell you to take a hike. The only time I ever did that was when we were selling our first house for an asking price of $63,900. The offer was for $58,000, but using a VA loan so WE would have to pay 3 points, plus they wrote in that they wanted my kitchen table (an antique from my Grandma). He didn't get a response--but then again, someone else came in that same day with a full offer. If no one else had bid, we may have looked at it again.
Robin M.

 

[petrymom]

I have to agree with the other posters!!! Only experience I had with this was also when we sold our first home. Tried to sell for $67,900. Ultimately, sold for $62,000. The buyers originally bid $57,000 and I was ticked, but we countered back and forth and ultimately it came down to how bad we wanted to build our new house.

There are a lot of variables that might affect this person's reaction - how long the house is on the market, why they are selling, how other houses are selling!!!! Ours had been on the market for 8 months and I was really itching by the time the offer came in.

Good luck - this is an exciting time for you!!!!! :

 

[caitycaity]

hey good luck!

dh and i just put in an offer too and we are still waiting to hear as well.

 

[barkley]

i think it also makes a difference in what you are "coming to the table" with. if you are preapproved/prequalified for a loan, have a significant down payment, are flexible with a closing date (as to make it convenient for the seller) and have no contingencies you are much more appealing to a seller.

when we bought our first home 15 years ago (an older home) the buyers had priced it at $139,000.00 and we knew they had previously turned down an offer of $130,000, BUT we also knew that they had accepted another higher offer that required them to replace their entire roof-and that offer had fallen apart a few weeks before it was supposed to close. so they had another home they had a contract on, and money out on a new roof. we offered $130,000.00 and they jumped on it. currently although our market is slow (we've had horrendous rains) bids much below asking are still fairly rare-in fact up until right after the first of this year a seller would not have likely even considered a contingent sale. contingent sales are being accepted now, but generaly to get them accepted the buyer is offering asking or above as well as setting a short timeline to meet the contingency while allowing the seller to continue to show their home and take offers (with a 72 hour right of refusal).

if i had a home selling in the hundred to three hundred range a 5% below bid would'nt seem like near the hit it would be in the 500-600 range (25-30 thousand is around 7 price reductions from an initial asking price).

 

[LuvN~Travel]

We too just had our first offer rejected, but we assume it was a bit of not thinking on their part. But, luckily they did accept our second offer. We did see enough potential in the house to let the new pool liner slide for now. Now we are just waiting on the appraisal and inspection to make sure everything is okay.
Our biggest gripe was the fact that THEY did not want us to get the mortgage for above the agreed asking price so we could make some upgrades! Strange. It wasn't anything they would have paid for or even had to pay taxes on. Odd couple!
Oh well, at least we should be able to get a home equity loan in six months to cover the upgrades we orginally planned, i.e. new counter tops, switch to all electric stuff, etc...
Kim

 

[DVC Sadie]

The owners are asking 675,000 and we are putting in an offer today or tomorrow for 635,000. I just want to make sure that the owners don't feel insulted but we want to get the best possible price that we can.

The house is solidly constructed and was built in 1972 but needs a lot of updating. The wallpaper needs to be removed and either redone in paint or more wallpaper. The appliances and sink need to be replaced except for the refridgerator and separate freezer.

What do you all think? Is this a fair offer or should we reconsider our bid. All suggestions are welcome and I won'r get upset if you voice your opinions.

TIA, Sadie

 

[golfgal]

It all really depends on your area, how long the house has been on the market, what their target price is. There are 100's of variables on something like this. We have never made a full price offer on a house and tend to come in on the low side. We usually end up countering at least once. That is just the way the game is played. In a really HOT market, they may not look at your offer but since the real estate market in most areas is pretty slow, they may be really happy just to have an offer of any kind.

The owners will either reject your bit outright, counter with a price somewhere in between the two or accept your bid. If they reject your bid outright, then you can come back with a higher bid, if they counter you may either accept that or counter again depending on what the come back price is. If they take your bid, they you .

 

[The Mystery Machine]

Price?

Is 675,000 top dollar for "move-in ready"?
What is the competition?
How long has it been on the market?

Let's talk upgrades that count...3 biggies.
Is the entire kitchen out of date?
How about the bathrooms?
Flooring?

Also...675,000 is an "odd" price. Hmmm...Normally it should be listed as 674,900. Sounds like the owners insisted on that price.

 

[caitycaity]

that sounds a little low to me for that asking price, but i don't know your area or your situation.

we put in a bid at the owner's asking price for a number of reasons.

1) comps have been selling right around their asking price, so it was reasonable
2) we put the offer in a day before their first open house. i am sure they got other offers
3) we REALLY want the house. very few houses have been on the market in our price range in the area we want to buy. this one is by far the best out of the ones we have seen. it has a lot more usable interior space and it had 99% of what we were looking for. we also are under time pressure as we have to give notice or sign a 1 year non-breakable lease at our current apartment by june 1.

your real estate agent should be able to help you out with your offer - that is part of their job. just make sure you let them know if this is THe house or if you are happy to keep looking. our agent told us we could put in a low bid at first, but if we did that we might not get the house. i think the most we could have saved off the asking price was $5K and it just was not worth it to me to lose the best thing i've seen in 2 months when the likelihood we would find something better before we needed to close was very slim.

 

[DVC Sadie]

Price?

Is 675,000 top dollar for "move-in ready"?
What is the competition?
How long has it been on the market?

Let's talk upgrades that count...3 biggies.
Is the entire kitchen out of date?
How about the bathrooms?
Flooring?

Also...675,000 is an "odd" price. Hmmm...Normally it should be listed as 674,900. Sounds like the owners insisted on that price.

The house would be move in ready but all of the wallpaper is very dated and we would want to rip it out and either repaint/wallpaper the 1st floor before moving in. The second floor I can redo one room at a time after we move in.

The house has been on the market since January of this year and the market is soft right now for homes costing 500,000 or more. The square foot of the house is 5700.

The kitchen cabinets would not need anything done since they are all solid cherry with no veneer. The appliances, sink cooktop and dishwasher all work but we would definitely upgrade them before we move in.

The flooing is a combination of inlaid brick herringbone design and octoganol tile inlaid in the kitchen and laundry room. All of the bedrooms and stairs have wall to wall carpet but in all different colors. I could always change it at a later date.

I don't know who priced the house, whether it was the owner or realtor.

What we love about this property is it sits on 5 acres and has a huge pond, pool, poolhouse, greenhouse and a 4 car garage. The entire back yard makes you feel as if you're in your own private park.

Another reason we love this house is because it had no damage from Katrina. It was high and dry so we would have the ability to stay in this home in the event of another hurricane coming this way.

Edited for both spelling and content.

 

[DVC Sadie]

your real estate agent should be able to help you out with your offer - that is part of their job. just make sure you let them know if this is THe house or if you are happy to keep looking. our agent told us we could put in a low bid at first, but if we did that we might not get the house. i think the most we could have saved off the asking price was $5K and it just was not worth it to me to lose the best thing i've seen in 2 months when the likelihood we would find something better before we needed to close was very slim.

caitycaity, I did ask my agent and she told me to offer 600,000 but I didn't want to insult the owners. The agent said that was a good starting point. I told the agent that I don't like to go back and forth but wanted to make a good offer for the beginning without all the pussyfooting around.

We (dh and I) are novices when buying a previously owned home so thats why I came here to the dis to ask these questions.

Our previous homes were new construction so I know very little in regards to dealing with agents and owners.

Thanks to everyone for this help. I really appreciate everyones thoughts on this matter.

 

[Nana Annie]

 

[The Mystery Machine]

Well at an offer of 600,000 that is 105 per sq foot which can be a respectable starting point to be honest.
635,000 makes it 118.00 per sq foot which I would consider a solid offer.
However the property sounds great, good stats, 5 acres...etc.

What to do, what to do....On the market since Jan. and not sold yet does give some power, hence the realtor telling you to offer 600,000.

What do you want to pay?
What can you afford to "lose" in the event you had to sell and you are "stuck" like they are in a sluggish market.
If you pay 650,000 let's say and HAD TO sell next year, (let's pretend), and someone came to you with 600,000 what would be your bottom "loss".
Realty fees alone are a big part.

Good Luck playing the "Real Estate" game. I guess trust your Realtor would be my first thought.

 

[barkley]

someone questioned why a seller would not agree to selling the home at a higher price so the buyer could get a higher mortgage for improvements (i assume the buyer would be asking for a credit back of the higher amount for the improvements). reason why they might be hesitant-they could LOSE money in the deal. not all realtors are willing to forgo the commission on these deals so a $20,000 credit back could cost the seller $1200.00. also, if they have significant equity in the home they could be looking at capital gains issues-we have homes in our neighborhood that sold for $180,000 7 years ago currently selling for the mid $600,000 range-while a married couple would be o.k. if they've lived in the home 2 years, a single owner is going to get hit big time so they want to limit their liabilities.

to the op-one thing i would caution you on in purchasing a home like this is considering the on-going upkeep costs when determining your top offer. it sounds like a stunning property, but if there is extensive landscaping it could be that either the current owners are slaves to it or pay a premium for someone else to keep it up (had a former boss who bought a place with beautiful landscaping not realizing the owners spent 3-4 hours per day keeping it up-he ended up putting a load of money into re-landscaping it to a more managable/automated watering system). also, a house built in 1972 is one that may have major $$$ items nearing replacement time (roofing, heating/air systems) so it may be that it's been unsold because of other buyer's concerns with this. idealy you have a realtor who is very familiar with the area and this type of home and will help you construct an offer with contingencies for renegotiation based on any issues that come up with a whole home inspection.

i'm curious though-will you be doing any upgrades and repairs yourself? if not-i thought i'de seen on the news that it's next to impossible to get any contractors for remodeling work in the "katrina zone"-all are working on re-construction. if that's the case in the area you want to buy in you may have to wait a while before you can do the cosmetic stuff you want.

 

[Dan Murphy]

Not really knowledgeable about housing, having purchased once, when we got married, 35 years ago, but sure wishing you well.

 

[DVC Sadie]

Well at an offer of 600,000 that is 105 per sq foot which can be a respectable starting point to be honest.
635,000 makes it 118.00 per sq foot which I would consider a solid offer.
However the property sounds great, good stats, 5 acres...etc.

What to do, what to do....On the market since Jan. and not sold yet does give some power, hence the realtor telling you to offer 600,000.

What do you want to pay?
What can you afford to "lose" in the event you had to sell and you are "stuck" like they are in a sluggish market.
If you pay 650,000 let's say and HAD TO sell next year, (let's pretend), and someone came to you with 600,000 what would be your bottom "loss".
Realty fees alone are a big part.

Good Luck playing the "Real Estate" game. I guess trust your Realtor would be my first thought.

Having never bought a home through a realtor we are unsure of ourselves to say the least.

I don't want to pay more than 645,000 top offer but who knows what the top price for my husband would be.

If for some reason (lets pretend) we HAD to SELL next year I wouldn't want to take a financial bullet but we could take the loss if it was absolutely necessary. Gosh, I don't even like to think in those terms.

My dh and I wanted to make a solid offer without playing the real estate game. I guess we better be prepared for the games anyway, huh?

This house is a good home for us because the master bedroom suite is on the first floor therefore we can do all of our living on one floor without ever having to go upstairs. We can close the upstair bedrooms off unless we have friends or family visiting since it has a separate air/heat unit for the 2nd floor.

If for some reason the owners don't like the offer or haggle too much I can realistically walk away because I am not emotionally attached as of yet. My husband seems to have an emotional attachment already so I guess I just have to wait and see.