Do you live in a buyer, seller or neutral market? If you are in a seller market, you will have to readjust your thinking. If you are in a neutral or buyer market, this seller will have to readjust his/her thinking or not sell.... but that thinking may not be adjusted in time to sell their condo to you.

IMO you should move on. You are frustrated with the seller but s/he is under no obligation to sell below list price (and a full price refused off would only obligate a payment to the Realtor if they pull their condo off the market). You cannot force these people to face the reality of what their condo is "worth" - BTW, are you sure you are correct? Did your Realtor pull comps so you could be certain you are presenting a fair offer? Or, is the "worth" in your mind? Also, don't get wrapped up in what the seller's purchased the condo for. Some areas appreciated substantially and even with a market correction are still far ahead of their value of three years ago. What you care about is what the condo is worth today and what your crystal ball tells you the condo will be worth at the end of the three years you plan to live there.

I'd counter but before I can say what I think you should counter for can you answer the following questions. What range would the condo appraise for (important if you need a mortgage)? What kind of market are you in - buyers or sellers market. How long has it been for sale? What are prices doing in the area rising or falling?

Another point to consider is that the current owner might have taken out an equity loan/line that has a balance. He/She may need to get $165 on the property to clear the outstanding liens of the first and second mortgages.

Counter what you think the property is worth, but be prepared to walk away. You have already said that $150 is what you are willing to pay, so I'd recommend countering with that.

These are both good comments for me to consider. thanks.

I am in NJ, but our town, according to our realtor is only slightly below what he would consider "average", but in general I've been seeing prices falling.

The particular property has been on the market 100 days now.

The only condos in that complex that i found to have sold recently are the 2 i listed. Same lay outs, at 132 a year ago and 152 6 months ago. I just don't think with what was done to the condo it is worth 170.

we offered what we did b/c our realtor said in his opinion in that area, that is what he would offer, and since that aligned with what we were thinking, thats what we put the offer in for.

i think the more i think about it instead of just reacting, i'll ask our realtor to double check on the area comps. I think we might put in another offer based on that and if they don't take it, they don't take it.

I agree with not getting hung up on what the seller paid for the condo. You don't know the circumstances even if Zillow is correct. Could have been a foreclosure, well below comps, or even a divorce situation with one spouse buying out the other, or any other number of reasons for the price paid a few years ago.

Your main concern should be the fair market value of the unit today. If you've done all your homework, received some current sold comps from the realtor, you should know what the fair market value of the property is. Base your offer upon the recent sold comps. If that's significantly lower then the asking price and the seller turns you down, move on. If the home is indeed overpriced, it will sit for a while. If you really like the home and you have the time and patience to wait it out, keep an eye on the unit and make an offer when the price is lowered to closer to your range.

Many, many sellers are having to take money to closing with them because of mistakes they made, that doesn't change the fair market value of the home. You're not responsible for paying for their mistakes. On the other hand, if the home is fairly priced, someone else will pay their price.

Cindy - that was my initial thought as well. which is a shame b/c if that is the case, i don't see where the money went

Another point to consider is that the current owner might have taken out an equity loan/line that has a balance. He/She may need to get $165 on the property to clear the outstanding liens of the first and second mortgages.

That would be my guess. There are way to many people who used their homes as piggy banks in the last few years.

blindthesky: " i don't see where the money went"

Could have gone anywhere...credit card and/or medical bills...car payments...college tuition, etc, etc..a home equity loan does not have to be spent on the house itself.

IMO...the seller may very well need the money in order to pay off the mortgage and/or the HEL...if that is the case, chances are that he can't come down on price.....no matter how much he would like to sell.

Hopefully that is not the case.
Best wishes.

thanks. all of your comments helped me think about in a more rational way.

i'm a Pisces, i'm over emotional about everything and tend to react that way first.

You say "the only comps you could find". Does that mean your realtor has not gotten any? It could be there aren't any more than what you found, but your realtor should be giving you a better picture on comps, specific market area "hotness", DOM for like properties, potential for resale vs. similar condo's in other areas etc. Do condo' sale prices show on county websites like houses? Isn't that where Zillow gets its info? You should be able to check it yourself.
I would especially ask him for the percentage of list price vs. sold price for condo's in your area (or just your general area if that's all he can break out). That can be an eye opener.
What's appreciation been in your area? Sometimes for grins I look at what a house sold for and look at appreciation numbers and do the math and gee whiz wouldn't you know, very close to asking price.
If they bought in 2004 for 110,000 and, not knowing when they bought add in 4 years of 11% appreciation that gets you to 166,987.
Just some more thoughts on pricing.

"Plus, since we only plan on staying there for about 3 year our plan is to buy, sell and at least break even i just don't think that will happen buying it for 165.."

I would seriously consider renting for that short period. Look at your purchase and sales expense and the possibility of prices dropping xx% in 3 years, are you willing to take that loss?

and no matter who we talk to, we get a different one.

the mortgage on the condo, plus association fees, and taxes is less than what we would pay for rent in our area.

we flip back and forth monthly on what to do about this, we can afford it, and have good credit and have 0 problem getting that small of a mortgage.

the flipping back and forth is just coming to a head right now b/c our lease is up at the end of february and we aren't renewing it.

Three years is to short a period to even expect to break even, especially given the market volatility of late.
Just keep renting.

Sellers that are 'upside down' are all over now.
They borrowed whatever the banks would lend, and now are stuck trying to cover the debts they have accumulated.
They will belled slowly month by month since it appears less painful than coughing up a lump sum to pay for the debt.

You can always sign a one year lease and try again next year.
The same place may be available.

We get a call back today saying that the seller will not go below 165 ( seller HAS to get at least 165, according the her realtor), but countered us at 168. Zillow ( while i know isn't always accurate) says the place was bought in 2004 for 110. there is NO WAY there are 55,000 in updates to that place. The cabinets and walls look like they were painted with mops and a 4 year old with a basic grasp of putting puzzles together could have tiled the kitchen area better than this seller did.

You can't count on zillow for everywhere. In my area it is wrong, my whole street is numbered wrong, and while there is an aerial photo of my house, they say my house is a block away according to the numbers.

What part of NJ are you looking in? I know a lot of apartment complexes converted years ago & if it's older, I'd be hesitant to buy in an older building. Condo resale, depending on where you are buying, can be bad. With what you are seeing with days on the market really isn't much.. house are taking a good 5 months from what I see, so 100 days isn't much, especially for some condos.

Also as others have said, forget zillow. For someone like myself with high medical bills, if you are not bringing money in, you have to get it from somewhere. There's a 3 bedroom house up the street for me in sheriffs sale for a little over $150k last I looked. They lost the house because the wife had cancer, hubby had to borrow against the house to pay the bills. I know someone that started a business with a home equity loan but had to ditch the business before they made the money back.

You need to step back and figure out what comps are, & how much that space is worth to you. Can you get a small house for the same $$?

Good luck.. I'm a Pisces too and have tried to take zillow with a grain of salt, especially after reading here. One never knows...

Set your maximum price in stone. Counter again at say $148, you've now gone up 8 grand and see what the seller does. If he only goes down another 1,000 walk away since you're wasting your time, if he goes down considerably counter for the final time at $150 and walk away if he doesn't accept and recounters. That's what I would do. Just stick to your guns.
OH, and if you reach your final stage offer of $150k don't give the seller more than say 6 hours to accept/reject/or counter. No sense sitting around 24 hrs fretting over it. Giving them a short time to finalize should show you're serious about it being your FINAL offer and the game playings over.

My .02...

If the seller owes more than the condo is worth in this market (which sounds like it may be the case) your agent can advise the listing agent that your final offer is exactly that, you will not come up any higher, and that their client should consider a short sale because of their situation if they are serious about selling at this time.

Do not over pay because someone else drained every penny out of their place while the market was inflated (or whatever the case may be), especially where you plan on selling again in 3 years.

roselvr - we are just north of princeton, so you can imagine the prices we are dealing with, small houses are over $250. the issue isn't the price of them, we could afford that. i just don't see the point in spending all that money for a small 1 bedroom house. i rather save that money for year and get something better.

the only reason we were considering these condos was b/c the price was low and the mortgage + fees would be less than rent.

part of my frustration involves my large student loan payments that could be being saved each month, so the large amount of bills isn't foreign to me.

It looks to me that you want THAT unit. Because it's priced the way it is you're getting upset. If the seller wants more than you believe it's worth, WALK AWAY! Why do you keep going back to it? Welcome to the world of real estate. You may not get what you want. It happens every day. And the owner is upside down because s/he may have taken out equity loans to buy a new car for all we know. So now s/he owes more than it's worth. But for you to get all upset about that is wrong. Again, offer 150 and if it's refused, walk away and forget it.

Do they really have 1 bedroom houses in the Princeton area? I thought they were all torn down for shopping centers. Or corporate campuses. Or condos.

If you don't think it's worth that much, than don't buy it. The seller could ask a million for the condo, it dosen't mean they'll get it. Some sellers get a number in their head and won't budge, I know a couple that's wants 799,000.00 for their house and not a penny less - they are prepared to stay until they get it (they own the house free and clear).
The market usually opens up in the spring, maybe you can negotiate a 3 or 6 month lease, to give yourself more time.

"Do they really have 1 bedroom houses in the Princeton area? I thought they were all torn down for shopping centers. Or corporate campuses. Or condos."

Or...5,000 plus SF pseudo-mansions. However..it depends on just how far north of Princeton we are talking...areas such as Ewing, Pennington etc may be more apt to have small homes for 250k still in inventory...

Don't push yourself into a bad purchase just because your lease is ending.

Having just bought a house in a somewhat seller's market, I regret that I didn't just slow things down a lot and let the seller try to get his desired price. Our realtor really advised buying the house at the seller's price and provided some comps to show that the price was warranted.

Now in hindsight, I really think that we paid too much. If I could do it again, I'd walk away for a while and not listen to my buyer's agent as much as I did.
Good luck
Susan

It really doesn't matter what a seller paid for the property...they can ask whatever they want. Now whether someone will pay their price is another matter.

Really people, just because the prospective buyer was told the seller has to get $165k, many are assuming the seller over indulged. It may simply be a sales tactic, the seller may want to buy another house for X amount.
Why do people jump to the conclusion that the condo was over financed, of course, all of you may be correct, but I don't understand the thought process of this.

It's totally irregardless of what the seller "has" to get for their property. I'd inform the seller's agent $150K is my best and final offer, and he's not willing to accept it, then be content with paying mortgage payments on a condo they no longer want to own.

I'd stay put unless rents are skyrocketing. In two to three years the market will most likely bottom out.

Let's say you buy this place now for what you already offered. The market is still diving in most areas. What could you sell it for in a year? Two years? Don't forget to add in the realtor's commission, closing expenses, etc.

If the sole reason you'd buy now is financial...why buy in a declining market?

hi there!

do you mind if i share your story in a book i am working on "everything homebuying book" new edition? my email is pipernichole@hotmail.com. thanks so much!
piper

We have really gotten stuck in the depreciating market. We started major home remediation and renovations back when prices were still merrily rising, not dreaming that our initial 250K invested wouldn't "get it done". (time and materials + many "surprises" on route).

Now - we are feeling the pinch in our finances and wondering how much longer we can ride it out, while having, at this point, a home that is probably worth a $100,000 less than what we have put in, yet still needing, I'd say, at least 20K more in basic work just to finish off and be presentable. Another $30-$35K on top of that might kick up the value quite a bit, if we could afford it, - but it would still be only have a 1 car garage! We have credit card debt accumulating again (we were paying off every month) and college tuition looming.

What would you do?

a) Try to "ride it out" with no more improvements for now.
b) Try once again to refinance now that interest rates are low. Maybe even with some cash out?
c. Borrow anyway possible and make the improvements that will kick it up in value?

Nailbiting -

Sorry,

Meant to post the above "What Would You Do?" as a new thread!

As someone who recently sold a house after owning it for three years, I would also caution you to really think carefully about whether buying this place will make financial sense. I don't live in NJ, but I understand that the property taxes are quite high. Did you include property taxes in your calculation of "mortgage and fees?" The property taxes will add anywhere from $250-$500 per month on to the payment, depending on what the tax rate is in your town. You can go to the website below to find out

Even if this is less than your current rent, you still need to consider the expenses that you'll incur when you sell. You'll have to pay an agent's commission (usually 5-6%), plus fees that will vary by location but could be 3% or more of the selling price. You're going to need an appreciation of at least 3% per year just to cover expenses, which sounds reasonable but may not be realistic for your local market. Not to mention the hassle and stress of selling!

Anyway, I know you didn't ask for an opinion of whether or not to buy, but I hope you'll really carefully consider whether or not it's worthwhile in your situation.

Here is a link that might be useful: NJ tax rates

Did the seller hold a gun to your head, and force you to make an offer?

What he paid x amount of years ago is not your concern. There is no law which says that houses can't appreciate x amt in y amt of years.

Just pass this one up, and move on.

blindthesky-"I am in NJ, but our town, according to our realtor is only slightly below what he would consider "average", but in general I've been seeing prices falling. The particular property has been on the market 100 days now. "

Doesn't sound like you have much time to buy a house before your present lease expires. I'd look at properties that have been on the market even longer than 100 days and see if you could work out a rent to own/lease option with the owner.

Lots of owners who have to move for job related reasons are doing this until the market improves.

i guess i'll update.

we ended up counter offering and the seller refused to budge. we just didn't think her list price was what the place was worth. at this point, it was too late to close on something before our lease was up and we were left with no where to live. we signed a lease on a new apartment for a lot less than we are paying now.

i'm not ecstatic about it. it is a lot smaller than our place now but we'll be saving a lot of money. the plan is to save the down payment we were going to put on the condo plus all the extra money we save over the year to buy something else. at this point we'll be able to afford a lot more.

i just have to remind myself it is only a year and we'll hopefully end up with something better.

Although it may seem like a paint to rent now, you will be saving up more money and maybe when you are ready to look again seller's have become more realistic in their prices too.

Good Luck to you!!

it IS only a year, and i bet in that year, you will end up with something a lot better.

The market is not going to suddenly soar, not anywhere. And it's going to continue to drop (slow or fast, depending) in lots of places.

And you'll be a much better educated buyer, and you'll have more time to look and decide.

(who knows--that exact place may still be on the market, LOL!)

Keep in mind, if you want to buy something before your lease is up you, you might be able to negotiate with the landlord and pay a one month rent fee to break the lease(maybe this is already in the lease?). Often you can let the landlord know and might be able to agree on a fee you pay for landlord to allow you to break the lease early. But get agreement in writing.

Another option, if you find a place you want to buy, you can always pay rent for the remainder of the rental period and then move out of rental. This might not be so bad if it is 2 or 3 months before you lease expires AND if the home you buy is a good deal.

also, if you buy before your lease expires, you can paint, refinish the floors, etc., before you move in.

I know you're disappointed not to have purchased, but I honestly thing you're in the catbird seat!

You say he is overpriced but why do you want this particular home? It must have something(maybe it's location or view) that the others don't have. That is some of it's value.

But I agree, if you are going to need to move in 3 years then renting would make more sense.