How Much Should I Offer On This House?
This question comes up quite frequently when buyer’s are contemplating making an offer on a house. They want me to give them the optimum, ideal price to buy their dream home. When in actuality that is a decision they must make.
Now how do you determine the best price. Here are a couple of items to take into consideration:
1. What are the similar homes selling for in the area. If most of the homes offer very little variance on the price, at the same square feet, age, and condition, then that is what the market is saying is a fair price.
Have your Realtor provide you with a list of comparable sales and look at the ratio of the “asking price” to the “sales price”. Most of the homes in the San Ramon, Danville area on average sell anywhere from 2 percent to 4 percent off list price.
2. How much do you really want the house. If you decide to make a low offer, you run the risk of not getting the home. So the question to ask yourself when evaluating the price to offer “will I be disappointed or okay if someone else submits a higher offer?”
There is no “one size fits all” pattern for making offers on houses. There are still some deals to be found where you can offer 10 percent even 15 percent off list. These are generally short sales or foreclosures. And if a home is competitively priced below market, there will most likely be multiple offers, submitted at full price or over asking price.
As an example. In Danville a house was listed at $229,000 in an area where most homes sell for $450,000 and up. The home had 13 offers and sold for $330,000, $100,000 over list. Extensive rehab was required which was reflected in the list price but that did not deter the buyer pool.
Your goal – get the best house that meets your needs within your budget and with a mortgage you can comfortably live with.
Filed under: General RE Tips
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