Anyone bought or sold a house recently?

[Blastoderm55]

My wife and I are looking to make an offer on a house in town. It came on the market a little over a year ago at $159,000, and dropped to $149,000 about six months ago. We really like the house. It needs a little bit of work (gutters, landscaping) but is mostly move-in ready.

The home was a foreclosure property that was purchased by the current owners in 2008 and then flipped. The appraisal district has the property value at ~$118,000, and the sellers most likely paid much less at the time they purchased it. Such details are pretty much moot in their consideration of our offer though.

We are considering offering $135,000, plus closing costs paid by the seller. Does that seem reasonable? If you were the seller (an investor, by the way), and had the house on the books for over a year, would you be willing to accept? We are ready to pay for half of the closing costs, but figured we'd go in with some room for negotiating.

Any feedback or comments are appreciated. :)

[BullsFan]

It probably depends on how much the seller has in it and how desperate they are to sell. $15K is a pretty big diff from their asking price. Then again, there's a huge diff between the appraisal value and their asking price. In my area appraisal values tend to be on the high side, and sometimes mortgage companies won't finance that much over the appraisal value.

I will tell you this: my cousin and her ex-husband sold their house recently. They put it on the market over a year ago at a higher cost hoping to make a profit. They finally just sold it last month, and they basically ended up selling it for what they had in it which was considerably less than they wanted. But in their circumstances they just really wanted out. Make the offer, and if it isn't too far from what your seller wants they'll at least make a counter offer.

[ronwx5x]

If you are using a realtor, ask him/her. If not, how badly do you want the house? A really lowball offer may not even get a counter. My opinion, closing costs are paid by individual parties. Seller has closing costs, buyer has closing costs.

If you feel like trying, make the offer and see what happens. The very worst is they say no or make a counter above what you will pay. About 2 counteroffers is usually as far as it ever goes.

[Blastoderm55]

Our realtor didn't think it was unreasonable. Our mortgage officer actually wanted us to make a lower offer, and stressed that this is a buyer's market. However, we want to avoid offending the sellers, so we feel the $135,000 is reasonable considering the time the home has spent on the market. Plus, the move to the lower price occurred during the tax-credit period, which in my opinion, bloated a lot of home prices, so in all reality the price should already be less.

[IrishTex]

I work for a bank in the home retention department..

I guess my first question is...is this a short sale?

Deed -in - lieu of foreclosure? REO?

What kind of loan are YOU considering? ARM, Conventional?

Will you be paying your own escrow?

I need more details so I can have a better opinion.

:D

[Blastoderm55]

Originally posted by IrishTex
I work for a bank in the home retention department..

I guess my first question is...is this a short sale?

Deed -in - lieu of foreclosure? REO?

What kind of loan are YOU considering? ARM, Conventional?

Will you be paying your own escrow?

I need more details so I can have a better opinion.

:D

Not a short sale, FHA loan with escrow.

[big daddy russ]

Originally posted by Blastoderm55
Our realtor didn't think it was unreasonable. Our mortgage officer actually wanted us to make a lower offer, and stressed that this is a buyer's market. However, we want to avoid offending the sellers, so we feel the $135,000 is reasonable considering the time the home has spent on the market. Plus, the move to the lower price occurred during the tax-credit period, which in my opinion, bloated a lot of home prices, so in all reality the price should already be less.
Offer lower. I'm guessing it's down in the Corpus area, which is a slow market right now.

You're on an island in this situation. The sellers want to get some money out of it, the selling realtor wants to get some money out of it, and your realtor wants to get some money out of it. Out of the four involved parties, you're the only one trying to save money.

Sounds like the house has been on the market for a little bit, which means that the realtors are giving them bad information in the first place.

They say that the first offer a house gets is usually the best. Try to figure out how much money they have into the house and then offer a couple thousand less. If they're serious about selling it, they'll take the money and run. House prices have actually fallen the past year, so base values on like houses are less than what they were when the current owners purchased.

Don't worry about offending them. You're spending over $100 grand. You're the one with control of the situation. I'd take control, make an aggressively low offer, and let the chips fall where they may.

When my wife and I bought our current house (late-2008, after the bubble popped), we made a string of ridiculous offers on some 10 or 15 houses. We even offered $92,800 on a house that was listing for $148k. Most offers were $25k-$30k below asking price. And every time a seller turned down our offer, we'd let the sellers know that we were always open to talk if they ever wanted to deal.

Within several months of purchasing our current house, we had three callbacks (in a hectic Houston market) on previous offers.

Talk to your mortgage broker more about the situation (seems like he's the one who actually has your interests in mind) and whatever you do, don't let your personal realtor know that you're "in love" with a house. Let him/her know that you're willing to walk away if they (and by they, I mean both realtors and the seller) won't come closer to your offer.

You have the market by the balls. Grab and twist so hard that your realtor throws up. By the end of this process, you should have a love/hate relationship with your realtor. Remember, if your realtor says you're making a good offer, then you're offering too much.

[big daddy russ]

By the way, we're getting ready to go through the process again and are one of the few home buyers I know who are actually poised to make money (and plenty of it) on our current house. Our plan is to keep putting sweat equity in our investments until they finally pay themselves off completely. If we make a mere $20k pure profit on each move (plus money invested into the house), we'll have an extremely nice paid-off house within a decade.

[Blastoderm55]

Originally posted by big daddy russ
Offer lower. I'm guessing it's down in the Corpus area, which is a slow market right now.

You're on an island in this situation. The sellers want to get some money out of it, the selling realtor wants to get some money out of it, and your realtor wants to get some money out of it. Out of the four involved parties, you're the only one trying to save money.

Sounds like the house has been on the market for a little bit, which means that the realtors are giving them bad information in the first place.

They say that the first offer a house gets is usually the best. Try to figure out how much money they have into the house and then offer a couple thousand less. If they're serious about selling it, they'll take the money and run. House prices have actually fallen the past year, so base values on like houses are less than what they were when the current owners purchased.

Don't worry about offending them. You're spending over $100 grand. You're the one with control of the situation. I'd take control, make an aggressively low offer, and let the chips fall where they may.

When my wife and I bought our current house (late-2008, after the bubble popped), we made a string of ridiculous offers on some 10 or 15 houses. We even offered $92,800 on a house that was listing for $148k. Most offers were $25k-$30k below asking price. And every time a seller turned down our offer, we'd let the sellers know that we were always open to talk if they ever wanted to deal.

Within several months of purchasing our current house, we had three callbacks (in a hectic Houston market) on previous offers.

Talk to your mortgage broker more about the situation (seems like he's the one who actually has your interests in mind) and whatever you do, don't let your personal realtor know that you're "in love" with a house. Let him/her know that you're willing to walk away if they (and by they, I mean both realtors and the seller) won't come closer to your offer.

You have the market by the balls. Grab and twist so hard that your realtor throws up. By the end of this process, you should have a love/hate relationship with your realtor. Remember, if your realtor says you're making a good offer, then you're offering too much.

Being in Beeville, we have a lot of cyclical growth and short-term housing demand thanks to TDCJ, Sikorsky, and the school districts. While we have very few rental properties, there is a surplus of houses [though few in our range of $90-140k] for sale on the market. The ones that are priced well (at market) are selling in hours, whereas homes priced above the market are staying stagnant. We just find ourselves at the point where we are tired of wasting money on an apartment that is poorly serviced by the property management, and we want to begin building equity in our own property.

[jason]

when i bought my house about a year ago i was told that appraisal values don't mean squat when it comes to selling price - i would offer about $12k - $15k less than what you are wanting to spend and deal from there....

if they don't counter then you can always re-offer a little closer to your spending limit or just walk away.....

i was a first time home buyer though so i might not know what im talking about - but thats what i did and it worked out well for us...

[BleedOrange]

Originally posted by jason
when i bought my house about a year ago i was told that appraisal values don't mean squat when it comes to selling price - i would offer about $12k - $15k less than what you are wanting to spend and deal from there....

if they don't counter then you can always re-offer a little closer to your spending limit or just walk away.....

i was a first time home buyer though so i might not know what im talking about - but thats what i did and it worked out well for us...

If you are talking about the appraised values on the tax roles you are correct. A majority of the time those are lower than actual market value.

I would have the realtor pull some comps for sales in the area over the last year. Do a drive by on those properties which should help you in your own independendent evaluation.

[rockdale80]

Originally posted by BleedOrange
If you are talking about the appraised values on the tax roles you are correct. A majority of the time those are lower than actual market value.

I would have the realtor pull some comps for sales in the area over the last year. Do a drive by on those properties which should help you in your own independendent evaluation.

Bingo. Do comps in the area. Make an offer. The worst they can say is no. Most likely they will counter and work from there.

[rancher]

Offer a lot lower, you can always go up. However, take a look at the long view. If you read anywhere, we are in a period of extended DEFLATION, WHICH MEANS, PROPERTY PRICES ARE FALLING. This is everywhere, but at different rates. Just remember, it is just a place to live and houses are for sale all over. Be patient and wait him out for your terms. There is always a deal out there.

[Blastoderm55]

Update:

So we made our offer yesterday of $135,000 plus $5,000 toward closing. The seller countered this morning, asking for full price ($149,000) plus all closing costs paid.

We're walking away for now. We left the offer on the table should they reconsider at a later time. This home has been on the market since November 2008 and started out at $169,000.

My wife is really upset, but we'll be alright. If $149,000 was a good price for the house, it would have sold already as it was last reduced 6 months ago.

Thanks for all the information guys. There's a few more houses in the area we're interested in, so maybe one of them will work out for us. In the meantime, we'll just continue saving and improving our financial position.

[Ranger Mom]

Originally posted by BleedOrange
If you are talking about the appraised values on the tax roles you are correct. A majority of the time those are lower than actual market value.

.

Really??

Our house appraises for a lot higher than the appraised tax value.

[BullsFan]

Originally posted by Ranger Mom
Really??

Our house appraises for a lot higher than the appraised tax value.

Same here. My house was appraised at almost $36K higher than the tax appraisal value.

[big daddy russ]

Originally posted by Blastoderm55
Update:

So we made our offer yesterday of $135,000 plus $5,000 toward closing. The seller countered this morning, asking for full price ($149,000) plus all closing costs paid.

We're walking away for now. We left the offer on the table should they reconsider at a later time. This home has been on the market since November 2008 and started out at $169,000.

My wife is really upset, but we'll be alright. If $149,000 was a good price for the house, it would have sold already as it was last reduced 6 months ago.

Thanks for all the information guys. There's a few more houses in the area we're interested in, so maybe one of them will work out for us. In the meantime, we'll just continue saving and improving our financial position.
You'll find something. You're both young, you're both smart, and you're in a great position to buy.

A lot of times, it's just human nature. It's hard to come to terms with such a huge loss, so most sellers in that position don't look at a deal objectively. If it's been on the market since Nov. 08, then it's definitely a "bubble" house, and most of those owners/investors are so upside-down on their investment that they won't let it go for market price.

Don't know if that was the case here, but I know we ran into a lot of that when we were shopping. Good luck going forward, Dan.

[AP Panther Fan]

Originally posted by Ranger Mom
Really??

Our house appraises for a lot higher than the appraised tax value.

I think that is exactly the point he was trying to make, unless I read it wrong. Typically, the appraisal district "taxable" values are lower than certified appraisals.

I'm not 100% sure, but, I think appraisal district values are an unreliable measure because recent comps aren't always considered, they aren't reviewed all that regularly and are driven by the current tax rates...i.e. how much the taxing entities need to make to cover budget. Just my cynical opinion though.

Bd55, things certainly happen for a reason and often your patience will be rewarded. It's a karma thing.:)

[Reds fan]

Originally posted by Blastoderm55
My wife and I are looking to make an offer on a house in town. It came on the market a little over a year ago at $159,000, and dropped to $149,000 about six months ago. We really like the house. It needs a little bit of work (gutters, landscaping) but is mostly move-in ready.

The home was a foreclosure property that was purchased by the current owners in 2008 and then flipped. The appraisal district has the property value at ~$118,000, and the sellers most likely paid much less at the time they purchased it. Such details are pretty much moot in their consideration of our offer though.

We are considering offering $135,000, plus closing costs paid by the seller. Does that seem reasonable? If you were the seller (an investor, by the way), and had the house on the books for over a year, would you be willing to accept? We are ready to pay for half of the closing costs, but figured we'd go in with some room for negotiating.

Any feedback or comments are appreciated. :)

I have two Realtors in my immediate family, good ones too.

You have walked away but a couple things I would consider, your offer was effectively $130,000 for a home listed at $149,000. VERY rarely, on the first offer, does the seller ever counter back at much less than the asking price. It's just human nature when the seller percieves the offer as "lowball". Just like the buyer, they are feeling out the motivation. And as mentioned in previous posts, tax valuation is rarely a reliable indicator of the true market value. Ultimately in this market, until a home is under contract and it appraises for at least the contracted price, no one really knows the market value.

You had mentioned you were willing to conceed $2500 in your first post and that now your wife is upset. Why would you not consider upping your offer by the $2500? If seller continues to not negotiate then you have a MUCH better feel for what they may do. You lose nothing if they don't accept, but if they start moving in the right direction you may still have an avenue to purchase the home and make the wife happy at the same time.:)

[Blastoderm55]

Originally posted by Reds fan
I have two Realtors in my immediate family, good ones too.

You have walked away but a couple things I would consider, your offer was effectively $130,000 for a home listed at $149,000. VERY rarely, on the first offer, does the seller ever counter back at much less than the asking price. It's just human nature when the seller percieves the offer as "lowball". Just like the buyer, they are feeling out the motivation. And as mentioned in previous posts, tax valuation is rarely a reliable indicator of the true market value. Ultimately in this market, until a home is under contract and it appraises for at least the contracted price, no one really knows the market value.

You had mentioned you were willing to conceed $2500 in your first post and that now your wife is upset. Why would you not consider upping your offer by the $2500? If seller continues to not negotiate then you have a MUCH better feel for what they may do. You lose nothing if they don't accept, but if they start moving in the right direction you may still have an avenue to purchase the home and make the wife happy at the same time.:)

We don't really feel like jockeying for position in this. We went in with what we felt was a strong offer, and were prepared to eat the closing costs provided he accepted the price $135,000. His desire to maintain the asking price led us to believe that multiple offers would get us nowhere, so rather than waste more of everyone's time, we've conceded. Life will go on, and in all reality we'll just build as opposed to over-paying for one of the flipped-foreclosures that currently flood the market down here.

[Reds fan]

Originally posted by Blastoderm55
We don't really feel like jockeying for position in this. We went in with what we felt was a strong offer, and were prepared to eat the closing costs provided he accepted the price $135,000. His desire to maintain the asking price led us to believe that multiple offers would get us nowhere, so rather than waste more of everyone's time, we've conceded. Life will go on, and in all reality we'll just build as opposed to over-paying for one of the flipped-foreclosures that currently flood the market down here.

Gotcha, I was just wonderin'. :)

I'm sure you'll find the deal that is most comfortable for you, it's a great time to be a buyer.

[Ranger Mom]

Originally posted by AP Panther Fan
I think that is exactly the point he was trying to make, unless I read it wrong. Typically, the appraisal district "taxable" values are lower than certified appraisals.

I'm not 100% sure, but, I think appraisal district values are an unreliable measure because recent comps aren't always considered, they aren't reviewed all that regularly and are driven by the current tax rates...i.e. how much the taxing entities need to make to cover budget. Just my cynical opinion though.

Bd55, things certainly happen for a reason and often your patience will be rewarded. It's a karma thing.:)

My daughter just bought a house in Midland that when an appraiser came in and appraised it, it appraised at $129,000....the tax appraisal was $139.000.

[AP Panther Fan]

Originally posted by Ranger Mom
My daughter just bought a house in Midland that when an appraiser came in and appraised it, it appraised at $129,000....the tax appraisal was $139.000.


Maybe the Midland area is different, not sure. Hopefully she will use that certified appraisal to get her tax appraisal value lowered.

[sinton66]

There's an old adage that you should never pay more than 10 to 15 k over the appraised tax value. That is unless you can see improvements that were made that would equal the increase.

Also, if they dropped the price 10k in six months, it might pay to wait a bit more.

[Reds fan]

Originally posted by AP Panther Fan
Maybe the Midland area is different, not sure. Hopefully she will use that certified appraisal to get her tax appraisal value lowered.

Absolutely, with the pressure the appraisal districts are under from the state, the districts are catching up and in a lot of cases overvaluing property. It would be smart to keep up with your market conditions and at least speak with the appraisal district every year when their notice of valuation comes out in May. Youcan save yourself many $$$$ if you keep a close eye on this every year.

[BleedOrange]

Originally posted by Ranger Mom
Really??

Our house appraises for a lot higher than the appraised tax value.

Read what I said. The appraised tax value is usually lower than the market value. The tax valuations/appraisals are different than an actual appraisal which should be close to market value. Thus the appraised value on the tax roles is lower than actual market value. I think you are confusing appraisal for tax purposes versus an appraisal requested by a lender or property owner which should be close to the market value. In a nutshell, what you said is the point I was making.l

[BleedOrange]

Originally posted by Ranger Mom
My daughter just bought a house in Midland that when an appraiser came in and appraised it, it appraised at $129,000....the tax appraisal was $139.000.

She should protest the tax bill and get it reassessed. Its an easy process. My house is about 65% of market value on the tax roles.

[rancher]

You did the correct thing in walking away, we are in DEFLATION, prices for homes and property are coming down. The home owners who did not accept your offer, if they want to sell their home will be kicking themselves in a few months. Read the economic tea leafs, homes sales are down or flat. One article I just read show the stats that banks are now selling more homes than home builders. Be patient, something better will come along, trust me. Make sure on what ever you buy, get a good inspector to go over the home.

[SintonFan]

Originally posted by Blastoderm55
My wife and I are looking to make an offer on a house in town. It came on the market a little over a year ago at $159,000, and dropped to $149,000 about six months ago. We really like the house. It needs a little bit of work (gutters, landscaping) but is mostly move-in ready.

The home was a foreclosure property that was purchased by the current owners in 2008 and then flipped. The appraisal district has the property value at ~$118,000, and the sellers most likely paid much less at the time they purchased it. Such details are pretty much moot in their consideration of our offer though.

We are considering offering $135,000, plus closing costs paid by the seller. Does that seem reasonable? If you were the seller (an investor, by the way), and had the house on the books for over a year, would you be willing to accept? We are ready to pay for half of the closing costs, but figured we'd go in with some room for negotiating.

Any feedback or comments are appreciated. :)

I saw a decent brick house just off of 351 on FM 188 for sale last week(on the south side). It may not be what you are looking for but it might by worth a look.
Good luck BD55.:)

[Blastoderm55]

Update:

My wife and I will be making an offer tomorrow on a property that came onto the market this past Saturday. It is not even on the realtor's website yet, so we're hoping to snag a great home at a great price. It is priced slightly above its appraised value, but it really is priced well below the market. It sits on slightly less than an acre of land in a quiet subdivision about two miles outside of town, and about four miles away from work. Its just under 2000 square feet, has three nicely-sized bedrooms, two recently- updated bathrooms, a gorgeous living room, a formal dining room, a den, a recently updated kitchen with breakfast area, a laundry room, a two-car garage, a huge covered patio, a pond with fountain, a large metal storage room, and additional storage areas to house tools, lawn equipment, and livestock such as chickens or rabbits. It is priced at $130,000, and we are prepared to pay asking price and closing costs, but are going to ask the owner to retain possession of the brand-new refrigerator. We'd like to pay less if possible, but don't want to lose out on such a great home because a couple thousand dollars. It is definitely a home we can grow into and update to our liking, and provides the convenience of being move-in ready, whereas most of the homes in the comparable price range still needed a lot of work before we could call them home.

Wish us luck!

[BullsFan]

Good luck! In my area, that would be a steal!!!

[AP Panther Fan]

Originally posted by Blastoderm55
Update:

My wife and I will be making an offer tomorrow on a property that came onto the market this past Saturday. It is not even on the realtor's website yet, so we're hoping to snag a great home at a great price. It is priced slightly above its appraised value, but it really is priced well below the market. It sits on slightly less than an acre of land in a quiet subdivision about two miles outside of town, and about four miles away from work. Its just under 2000 square feet, has three nicely-sized bedrooms, two recently- updated bathrooms, a gorgeous living room, a formal dining room, a den, a recently updated kitchen with breakfast area, a laundry room, a two-car garage, a huge covered patio, a pond with fountain, a large metal storage room, and additional storage areas to house tools, lawn equipment, and livestock such as chickens or rabbits. It is priced at $130,000, and we are prepared to pay asking price and closing costs, but are going to ask the owner to retain possession of the brand-new refrigerator. We'd like to pay less if possible, but don't want to lose out on such a great home because a couple thousand dollars. It is definitely a home we can grow into and update to our liking, and provides the convenience of being move-in ready, whereas most of the homes in the comparable price range still needed a lot of work before we could call them home.

Wish us luck!

Sounds great. You made me want to move to Beeville. ;)

Keep us posted!

[Blastoderm55]

We got the house!

We offered full price and asked to retain the refrigerator, patio furniture, and have the first year of home warranty ($550) paid for by the owner. She countered by offering up the patio furniture and $350 toward the home warranty. We close October 6th, just in time to decorate for Halloween!

Wahoo!

[AP Panther Fan]

Congratulations! It truly sounds like a great place.

Let's see, if you are closing in October, you probably won't have to mow but a few times before spring.

Definitely going to need a riding mower and an assortment of lawn equipment...not to mention random household appliances from time to time. Holiday gift giving will become simple again.:D

[SintonFan]

Originally posted by Blastoderm55
We got the house!

We offered full price and asked to retain the refrigerator, patio furniture, and have the first year of home warranty ($550) paid for by the owner. She countered by offering up the patio furniture and $350 toward the home warranty. We close October 6th, just in time to decorate for Halloween!

Wahoo!

Congratulations!

[sinton66]

Congrats! Sounds like a pretty good deal from what you described.

[jason]

congrats...

why the long wait until closing?

i think my offer was accepted the last friday of july and i closed on august 7th...

[Ranger Mom]

Originally posted by jason
congrats...

why the long wait until closing?

i think my offer was accepted the last friday of july and i closed on august 7th...

You have already had your house for a year????:eek:

[Blastoderm55]

Originally posted by jason
congrats...

why the long wait until closing?

i think my offer was accepted the last friday of july and i closed on august 7th...

We're in no rush, and it gives the seller plenty of time to move out. We thought she was a widow, but it turns out her husband left her for a twenty-something year old girl. He's got lots of golf clubs and tools that will likely be sold as rummage, or perhaps left behind for the opportunistic new owners. :D

[jason]

Originally posted by Ranger Mom
You have already had your house for a year????:eek: will be a year on saturday since we closed...

wedding is coming up quick too - think you could have predicted a house and wedding for me 5 years ago??? LOL.........