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  1. #1
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    Jun. 24, 2004
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    Question More RE questions

    Still house shopping...

    Let's talk offers so I can get different perspectives. What would be a "fair" offer on a $350,000 house, been on the market for about a year. Don't want to get laughed at but want to leave room for a counter offer. Okay to start pretty low?

    How about appraisals, how much are those running these days?
    A friend told me I was delusional. I almost fell off my unicorn.



  2. #2
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    I think appraisals run about $400 or so, depending on the location. If you're going through a realtor, then ask them about a good starting price, that will save you money, but not insult the seller. Have there been any price drops since it's been on the market? If not, then the buyer might be someone who insists on getting the perfect offer, at their price or nothing. If that's the type of seller they are, then they will proably say no to anything lower that full asking, and that will tell you if they aren't even going to sell. If you're going without a realtor, then the appraisal might be a good way to go, if you can get one before you offer (I don't know if that is allowed). I would offer at least 10% off, and maybe more because of the length of time it's been on the market. If they accept a low-ball offer without argument, then I would get the best home inspector I could find to really go over the place well. The reason it hasn't sold might be that it's overpriced for the market, or because something is really wrong with the place.
    You can't fix stupid-Ron White



  3. #3
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    Ask a Realtor to do a Market analysis for you showing what similar properties in the area sold for over the last few months (to a yr, if there aren't many comparables).

    You should be able to get the price per sf that the homes brought. Make sure they include any concessions the seller gave (such as 6000.00 for closing costs, etc), and calculate that into price per sf.

    Then offer about 10-15000 below that , minus any major defects/repairs to start negotiations.
    Generally, if I lowball, I make sure I have good cash dn, good earnest money down, a short financing contingency (if any), and a fairly quick close. I'm trying to make the offer as attractive as possible in every way, except for price. It's harder for a seller to just toss out a strong offer that is great in every way, except price. that way, they will at least counter, and you can start the ball rolling.



  4. #4
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    Yes, we will be working with a realtor. I just wanted to get some opinions from others also.
    A friend told me I was delusional. I almost fell off my unicorn.



  5. #5
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    Jan. 18, 2010
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    I worked as an appraiser for a while and would suggest that you look at what Zillow and Trulia say is the value of the house. They aren't always accurate, but can offer a good starting point. I'd also look at what the assessor's office has valued the house for, and then either add or subtract 25% from that. Depending on the area, and the last assessment, which might have been in either 2009, 2010, or 2012, depending on where you are, the assessment can either be dead on, or within 25-30% of appraised value.

    For a single-family home, an appraisal, rather than a BPO, would run around 400-450. If you can contract with an appraiser directly rather than go though an AMC or a bank, you might get one as low as $300-350. For the sake of making an offer, however, you might want to save your money, and have your realtor give you advice. Your agent should know the neighborhood market well, and be able to tell you why the house is still on the market after a year at $350,000. Maybe the house has specific features that only a specialized buyer would want. But if it's a typical home aimed at a typical buyer, that seems like a long time to be up for sale, and is probably priced way over market value.

    Check with the assessor's records to see about recent sales in the neighborhood and on the same street, if possible. That will give you some idea of what market value for property in the area is like. Zillow and Trulia will also offer some data about sales in the neighborhood. Local realtor listing services aren't available to the public, but these other resources are.

    Good luck.



  6. #6
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    Oct. 19, 2006
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    Minnesota
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    I would also look at any comparables that you get to make sure that they really are comparable. For instance, what Zillow and the city assess my house at is about 1/2 of what it's really worth. I have 36 acres, 28 of which is a private lake. Not only is there nothing comparable to that within 25 miles of downtown Minneapolis, but that acreage is exempt from taxes because it's a protected wetland. So what they say my house is worth, is not really what my house is worth.



  7. #7
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    Jun. 24, 2004
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    Yes, that's an issue with that house. It's a 10 acre lot with an actual house on it while the neighborhood is mostly 1 acre lots with modulars on one side (which makes it less desirable and harder to resale) and 35 acre lots on the other side (so hard to find comparables...



  8. #8
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    Nov. 5, 2002
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    way out west
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    When I sold my last house I had an appraiser come out before I listed it. He appraised it for about 50K less than what my realtor recommended as the listing price. I went with the realtor, and sold it for that asking price. I was sure glad I didn't listen to the appraiser, because when the buyers got an appraisal it came in at the asking price.

    My husband always told me "you have to be willing to walk away" when buying real estate. Don't get too emotional about the process. There are some sellers who will get insulted if your offer is anything lower than their asking price, especially if they've lowered it repeatedly as they chase the market.

    We bought a house once on a super tight time schedule. We made the offer through our realtor, who told them it was our one and only offer, that we didn't have time to go back and forth. They countered, but we moved on and bought a house a couple of blocks away. The first sellers were all indignant that we hadn't "negotiated in good faith". What part of "one and only" didn't they understand? Listen to a realtor you trust, and good luck!



  9. #9
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    May. 6, 2007
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    Napanee ON
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    We offered $290,00 on a house at the same price. It was on the market for 8 months with NO offers. They came back and said $329k FIRM. We came back at $300k, they said no. We walked away.

    A month later they came back and asked if we were still interested....we settled at $315. Got a great home and a great deal!

    ETA: Also depends how desperate they are to sell.



  10. #10
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    Quote Originally Posted by Sabino View Post
    I would also look at any comparables that you get to make sure that they really are comparable. For instance, what Zillow and the city assess my house at is about 1/2 of what it's really worth. I have 36 acres, 28 of which is a private lake. Not only is there nothing comparable to that within 25 miles of downtown Minneapolis, but that acreage is exempt from taxes because it's a protected wetland. So what they say my house is worth, is not really what my house is worth.
    Zillow and Trulia are normally waayy off. I sold a house that Trulia said was worth 365k. Home had been completely remodeled (floors with travertine, paint, granite throughout, appliances, lighting, sinks, faucets, frameless glass shower enclosures, shower/tub tile.) Home sold in 6 days for 425k. I laughed when some potential buyers came thru the open house the 2nd day listed and told me that the house was only worth 365k, according to Trulia, and they wouldn't pay over that.



  11. #11
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    May. 5, 2005
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    Quote Originally Posted by jetsmom View Post
    Zillow and Trulia are normally waayy off. I sold a house that Trulia said was worth 365k. Home had been completely remodeled (floors with travertine, paint, granite throughout, appliances, lighting, sinks, faucets, frameless glass shower enclosures, shower/tub tile.) Home sold in 6 days for 425k. I laughed when some potential buyers came thru the open house the 2nd day listed and told me that the house was only worth 365k, according to Trulia, and they wouldn't pay over that.
    This is exactly what my house is like, but I'm planning on putting on the market in May. Tthe previous owners wouldn't recognize it; absolutely everything has been renovated, similarly to yours - granite, travertine. I wouldn't even think of listing it for Zillow's estimate!



  12. #12
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    Sep. 2, 2005
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    Upstate NY
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    I just looked at Trulia for my house and I have to laugh. They are so accurate (not) that they have a photo of my neighbors house instead of ours.



  13. #13
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    Jan. 31, 2006
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    Maine
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    I've been an appraiser for 11 years now.

    Zwillo and Trulia are useless. According to them my house is worth 35% more than what it's actually worth.

    Appraisals (depending on location) are more often than not set by VA fee's which vary by state. http://www.benefits.va.gov/HOMELOANS...e_schedule.asp

    if you go through a large lender they'll farm the appraisal out through an AMC (appraisal management company) which will increase costs. Local lenders/Mortgage Brokers/Credit Unions are absolutely the way to go these days. Avoid Bank of America and Wells Fargo like the plague.

    You cannot choose your own appraiser for a loan.

    As far as making an offer ... I can't really help you there. It all depends on the motivation of the seller.



  14. #14
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    Jan. 18, 2010
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    Quote Originally Posted by Deuce View Post
    I've been an appraiser for 11 years now.

    Zwillo and Trulia are useless. According to them my house is worth 35% more than what it's actually worth.

    Appraisals (depending on location) are more often than not set by VA fee's which vary by state. http://www.benefits.va.gov/HOMELOANS...e_schedule.asp

    if you go through a large lender they'll farm the appraisal out through an AMC (appraisal management company) which will increase costs. Local lenders/Mortgage Brokers/Credit Unions are absolutely the way to go these days. Avoid Bank of America and Wells Fargo like the plague.

    You cannot choose your own appraiser for a loan.

    As far as making an offer ... I can't really help you there. It all depends on the motivation of the seller.
    I agree that Zillow and Trulia can be inaccurate, and also understand that for someone without access to MLS information, it's hard to get a sense of what a home might be worth. By looking at assessor records in combination with this data, it is possible to at least get an overall picture of the market area, with the understanding that there is room on either side for error.

    If the OP wants an appraisal on a property solely for the purposes of making an offer, it is possible to approach an appraiser directly without going through an AMC or a bank. For the purposes of a loan, no, but certainly for what the OP said she wanted.

    It can be tough to get data without access to certain realtor databases. I've seen Zillow and Trulia be way off, as the other posters have mentioned, and also seen their values be pretty spot on. For people outside the industry, it can be hard to find all the information they need. Assessor records are another key component in this, but nothing is truly set in stone. Even two appraisals from well established, well respected appraisers in the same market area can have two wildly differing opinions of value.

    Sounds like the OP's property is unique for the neighborhood, so she might want to look for similar homes on similarly sized lots in other areas of the same town/city. If there aren't any, search neighboring areas. It is also possible to extract the land value from the home value to make it more "comparable" to the others in the neighborhood, but you might want an appraiser to help you with that.



  15. #15
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    Jun. 24, 2004
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    Thanks! We are meeting with realtor tomorrow but it helps to have other viewpoints.



  16. #16
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    Mar. 30, 2012
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    Crestview, Fl
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    I have a question for the realtors posting. I was house shopping recently, we were thinking about relocating closer to base for work purposes. A home we were looking at originally sold for $95,000. The market bounced some and it's currently assessed for tax purposes at the $97,000 mark. It's for sale listed at $169,000. What relation does tax assessment have with the actual home value?



  17. #17
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    Quote Originally Posted by AirForceWife View Post
    I have a question for the realtors posting. I was house shopping recently, we were thinking about relocating closer to base for work purposes. A home we were looking at originally sold for $95,000. The market bounced some and it's currently assessed for tax purposes at the $97,000 mark. It's for sale listed at $169,000. What relation does tax assessment have with the actual home value?
    In most locations, not much. But when did it sell for 95k? And what has been done to improve it, since it originally sold for that? If it sold for 95k in 2000, then it could be worth 169k now, with no improvements. If it sold for 95k last month, then it depends on if the people REALLY got a good deal, or if they went in and completely remodeled everything. But the tax assessor value is generally meaningkless.
    There are homes here that the tax office has appraised for700k, yet were for sale for 450k and didn't sell, so they got foreclosed on and sold for 350k. Even fixed up, they wouldn't bring 700k, if you had put 100k in cash on the kitchen counter to include with eth deal.

    To find out the home's worth, you need to get a market analysis done on recent sales of similar homes in the area.

    If you were to buy that home you found for 169k, then you will at least benefit a little by a lower tax assessed value, because you'll pay less in taxes. At least until they do their next valuation, but even then, most taxing jurisdictions have a cap of what percent they can increase the value each year.



  18. #18
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    Don't mistake assessed value for taxation purposes with appraised for sale purposes. The assessed value is a sneaky method to raise extra revenue. When the county can't raise the tax rate, then they raise the assessed value, and tax you on the new amount, and that way they get more revenue. Appraised value or market value are sales terms. Some relatives live where their market value has dropped to the 400k levels, but the houses are still assessed for tax purposes in the 600k levels, and that 600k used to be the market value. The county still gets the huge property tax fees, even though the market and appraised values are much less.
    You can't fix stupid-Ron White



  19. #19
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    Okay so for example, this is the Assessor's data on that first property for sale at $350,000. Does that mean anything? It's actually lower than the purchase price from 2008, which was 320,000.


    Value Information Approach: Market
    Code/Description Value Type Appraised Value Assessed Value Taxable Value
    1112 Residential Land ................. $131,557 $10,470 $10,470
    1212 Residential Improvements..... $161,829 $12,880 $12,880
    Totals: ...................................... $293,386 $23,350 $23,350
    A friend told me I was delusional. I almost fell off my unicorn.



  20. #20
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    Nope. It simply is the value the assessor's office is using to tax the property. It is an artificial value, and if the county runs short of tax money, they raise they reassess the value of property, and then the taxes go up. For example, the county or municipality needs 10% more tax dollars, and for whatever reason they can't raise the rate they tax at, then they raise the values of properties as much as they can legally, and if it's 10%, then homeowners pay 10% more taxes. It has nothing to do with real value or appraised value. It also has nothing to do with the market value of the property, and especially has nothing to do with what the sellers will accept or expect. A hint from my years of buying and selling, just decide before you offer the highest amount you should pay according to your finances, and comfort zone, and stick to it. It's very easy to keep going and end up paying more than you wanted to.
    You can't fix stupid-Ron White



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