House Shopping: Notes

For buyers, the BEST situation to submit a low-ball offer is when:

1. Seller has reduced the price for 3rd time
2. Seller reduced price two times within 4 weeks
3. Property has been on the market for at least 4 months
4. You show up to OH and apartment is empty with no names on sign in sheet
5. You find out that seller bought 5+ years ago
6. Imperfections are cosmetic NOT permanent
Urban Digs

Err on the side of under-pricing
If you have to choose between over-pricing and under-pricing your home, under-price. When you under-price by $10,000 and the home isn’t bid up, you lose $10,000 at most. When you over-price by $10,000, you can lose much more: after a month the listing loses its luster, mortgage and staging costs pile up, and price-reductions signal buyers to ask for more reductions.

How long has the property been on the market?
The current listing sheet may say the home has only been on the market 30 days. But a quick look in the MLS may show you that this is the 3rd time the home has been listed, and all told, it’s been on the market for over a year. Longer time on the market means more negotiating power for the buyer.

Is the property vacant?
Has it been that way for a while? Nobody likes to have a house sitting empty, epecially when the house is in Knoxville and they are in Honolulu. Insurance companies don’t like it either. And nobody likes making two mortgage payments.

Is the seller motivated?
This is something you can’t always know up front. But if you somehow find out the seller is getting divorced/about to go bankrupt and has to move that property, stat, then strike while the iron’s hot.

Find out what the seller owes on the property.

It is very rare that a seller is able to afford to write a check at the closing table, much less agree to do it. In some situaitons coming out even will suit the seller fine, but paying someone to buy their home will not.
All Around Town