That's not an unreasonable offer. As a seller, I wouldn't be insulted by it. Along with your offer sell your positives. I would make at least one contingency, though: acceptable inspection and appraisal.

Good luck,

Kevin

You may have answered your own question - you said, "seller is not very willing to move from asking price." So why do you think he'll take $19k less? You're offering 92% of asking price. But make the offer and see what happens. You should be prepared to raise it some, though.

I do agree that you should have inspection/appraisal contingencies. You want to make sure the house is sound and worth the asking price.

Thanks. Appraisal and inspection are the only contingencies and are standard for the area. We don't have any other contingencies (sale of prior home etc).

We've been in contact with the listing agent who (recently) told us the seller was not willing to move on prior offers but they've discussed current conditions; a move on his part may be a requirement for a sale. I don't know when those offers were placed nor do I know details. One can guess the offers may have been low, considering the amount of homes for sale in the area.

We are prepared to negotiate and was looking to see if 92% was reasonable for a first offer and would not be deemed offensive. Nobody wants to pay full price when the house has been on the market for so long!

We just sold a home last year and although we would not have sold at 92% in our market, we would have considered a 92% offer with no contingencies to be a serious offer with which to negotiate. Go for it!

Your offer of $230,000 is not unreasonable. Some think of the tactic as "lowballing".

You assume that the owner will counter. I would hope so since the property has been on for over 6 months.

Two years ago we had a similar situation and we bid at 93% of the asking price. 12 hours later we had an agreement.

Best of Luck.

Enjoy the journey.

eal51 in western CT

The seller has been sitting since July 06. My guess is he watches too much TV and still thinks it is a sellers market OR he is waiting for someone dumb enough to not get an inspection.

Make your $230 offer with the contingency of it passing inspection and see if he counters. If he counters with anything that says no inspection run.

Is there a mortgage on the place?
The seller is not very realistic unless he owns free and clear.

One thing you mentioned sent alarm bells. You said "we have been in contact with the listing agent". Does that mean you are not working with a buyer's realtor? If that's the case, you should find one pronto.

Your offer is not unreasonable. It is a good starting point if the seller is willing to negotiate.

I would not consider it an unreasonable offer even with those contingencies. Those are just normal things you should have in there to protect yourself. I agree with the other poster, get yourself an agent - the seller will not save any money he or she is paying the full commission price regardless of the number of agents.

We have an agent and are not working with the listing agent to negotiate the purchase. We've been in touch with him over the past few months to discuss community developments. Our agent lives nearby and has kept us informed of developments but there are some specific issues we asked the listing agent to track.

While the listing agent has been informed of our intent, it was clear that our agent would present the offer.

I appreciate your input. We think it's a fair starting point and will be presenting today so wish me luck!

The worst that happen is they say no. There's only one way to find out. What's the new const going for?

Good luck!
What happened?

Don't know if the seller has a mortgage. He built it two years ago and live in it until June 06 (built another house). I'm guessing he does.

New construction in the area is priced from $100,000 - $400,000+. There are comparable homes in the same price range as this one; right around mid $200s. We looked at the new construction too but weren't thrilled with what we saw.

I'm still waiting for the offer to be submitted; finalizing the paper work. Hope to have it in before the weekend is over. We're going with $230 and hope to hear back soon!

I don't think that lowballing properties because they were on the market since last summer is appropriate.
Many homes were stagnant since last summer. It WAS THE MARKET, not their house. People were freaked out thanks to the media.

You don't say in what part of the country you are buying. THAT makes a difference whether it is considered lowballing or not. If I were buying in Ca or FL, I would offer at least 25% less than the asking price, however, in places where the appreciation has been modest (5-6%/yr)& never a big boom, offering anything less than 3% from the asking price is an insult.

BTW-the market is turning around in some parts of the country....slowly into the sellers market or at least even/even. It is in my neck of the woods. The inventory is very low & people are buying houses again.

We cannot generalize & make statements like "Oh, he thinks it's still a sellers market"....Spring is around the corner & not everyone is suffering from a buyer's market.

I know what you're saying Dabunch -- in our area we only see modest gains, consistent, but modest. Last summer homes were selling at about 97 percent of list, this winter that dropped to closer to 95 percent. The market has recently started to pick up but I'm not sure the prices have gone up at all. The original poster's initial offer is only a starting point, the worst that could happen is the buyer says no, the best that can happen is that the offer is accepted, and what will probably happen is that there's some negotiation and they'll meet on price somewhere in the middle.

Dabunch,

If it ends up being an insult to the seller, so be it. They can always say No, and no harm done. The buyers obviously don't always know what's going on in the seller's mind. It's an offer and a starting point for negotiations. Seems like a good thing.

The house is in an area that is growing exponentially. It's priced on the higher end for the area and is competing with 8 new subdivisions with construction prices starting anywhere from $100,000 to $180,000.

The seller is the builder. He's got it on the market for the upper end of what houses sell for. I'm 92% (get it?) certain that he's got some room to wiggle and has just stayed put because other people want the moon. Everyone wants financial assistance (pay for closing costs, add upgraded appliances). We don't. Just pass the inspection and appraise out; that's all we want. We know what we will do with the house and don't expect him to do it for us!

An offer of 92% of asking is hardly lowballing. It's a fair offer from a qualified buyer.

Kevin

Well, I'm bracing for flack. The market is not picking up. What people are seeing is a pale reflection of what happens every year after Super Bowl Sunday: buyers start making offers after waiting out the holidays. However, this year, even though more sales are going through than in December, there are some really frightening portents of trouble ahead. The number of vacant houses for sale is the highest it has ever been. Yes, the highest it has EVER been. This is a sign that the speculators who were responsible for much of the market froth during 2004 and 2005 are out of the game and trying to unload their investments. Nationwide, the inventory of unsold houses is rising again now that sellers who took their properties off the market during the holidays are trying again. Foreclosures and preforeclosures are jumping, and the irresponsible banks that made a fortune on exotic loans are starting to announce disastrous increases in bad depts. (Take a look at today's Wall Street Journal for a somewhat exasperated analysis of the troubles at places like Countrywide.)

Finally, the big home builders are not seeing any kind of a turnaround. Toll Bros. sent out another pessimistic announcement today. If the builders are still in trouble, and they are, owners of used houses are going to be facing competition from highly motivated sellers of new houses.

None of this signals an improvement in the housing market.

kaleberg wrote: Well, I'm bracing for flack. The market is not picking up. What people are seeing is a pale reflection of what happens every year after Super Bowl Sunday

I'm glad you're bracing.

Once again, you generalize about the ENITRE counrty. Why don't you comment on your local market, or at least stick to the West Coast?

The FACT is that the market here in NoVA HAS picked up--and it didn't wait until after the Super Bowl either. @@

laura, just curious - what do the @@ mean in your posts? I've seen them before and not sure how to take them.
---------
I don't think housing prices will be dropping dramatically, at least not where I just left (Orange County, CA) or where I am now (Portland metro, Oregon). They may have stabilized, but that's good for most people except those looking for a bargain. But that's just the markets I'm most familiar with.

Real Estate is local. What is true for one place may not be true in another.

minet wrote: laura, just curious - what do the @@ mean in your posts?

It's an eye roll, like saying a sarcastic "oh brother" or "as if".

And just to clarify, by the market picking up, I didn't mean that prices were necessarily going way up, but just that activity, i.e., the number of homes actually selling, has dramatically increased in my area. Across the board it seems like prices have come down ~10-15% from the stratospheric highs of 2005.

But there still isn't one house on the market in my zip for less than 549K, and there are only four that are priced less than 650K. So no "tanking" of the market in my part of NoVA.

Well Kaleberg I do think Laura has a point. In our area - central TX - we have a sellers market and prices have gone up since last year. I'm crossing my fingers that will hold and that we will find another place to buy where we are looking, but so far all indications are it will stay a sellers market around here.

230K after sitting 6 months? I may go even lower. I remember a guy telling me once, "If you aren't embarrased by your offer, you are offering too much". I went $35K under original list on a house that sat empty for months (same sitution, people buying newer homes instead). Got it for $25K under original list (88% of original list) and still think I paid 5 to 10K too much. But thats the nature of recent R/E negotiations (i dont get it for quite what i thought and the seller doesnt make quite what they thought.)

Laura, we have had disagreements on this issue, but our beliefs aren't really that different, just our emphasis. Yes, there is a lot more activity than during the dead days of November and December. This is true every year. Yes, houses are selling. However, the reason they are selling is that sellers are finally reducing prices, paying closing costs, making improvments, and offering concessions. I do not believe that the market is "tanking" in NOVA, but it is not recovering to the levels of 2005 any time soon. Sensible sellers will do what they must to get the job done now rather than waiting for a nonexistent turnaround to the good old days of the boom.

As for my Western WA perspective. I owned and sold a house in McLean. I went to Langley High. My cousins live in Middleburg. I know NOVA well. You are right about the 20 minute commute from McLean, by the way. Even on good traffic days the commute to DC was usually more.

Lyfia, of course you are right about much of TX; it's one of the few healthy markets left. But most of the NE, especially the Boston/RI area is simply tanking. Most of Forida is in a serious slowdown, especially for condos, and because markets there were so heavily influenced by speculators, the situation is likely to stay bad for a long time. Most of the upper Midwest is having a hard time. Arizona markets are in bad shape. CA is mixed, with real horror stories in the interior and stability in LA and SF. Portland is still doing well, but Seattle, for the first time, is showing slowing sales and a huge rise in inventory. My own local market is dead and embalmed. In other words, all real estate may be local, but the vast majority of houses for sale in this country are selling into a buyers' market. If you are in a neutral market, count your blessings because you are in the minority.

"offering anything less than 3% from the asking price is an insult. "

Are you assuming that the seller has priced the property appropriately?

If a home doesn't sell, it's not just the market--it's the relationship of that home and the asking price to the market. The market is what determines the value of a home for sale. If a home doesn't sell for a given price for seven months, then most likely that home is not priced appropriately for the market.

A lot of sellers would jump at a 97% asking price offer, and almost all sellers would counter, and that's not just in boom areas and down markets. Many, if not most, sellers price their properties a bit high to allow for negotiating. Offering a little lower as pretty much expected.

---The FACT is that the market here in NoVA HAS picked up--and it didn't wait until after the Super Bowl either. @@---

That was my impression, too. LetÂs see what the numbers indicate. Here are a few selected statistics just published today.

1/2007 NOVA/MRIS (FX,ARL,FC,ALX) - Resales

In January 2007, 1349 housing units were marked as sold. That number is 10% higher than January 2006. However, it is the second lowest number of units sold in any January since 2001! The rate is also the lowest number sold in the area over the last 11 months.

But,

The number of units that went Contract & Contingent was up 6% from January 2006. Also, the number of units C&C was at its highest since June 2006. But, the rate was its lowest for any January since January 2000.

FORECAST Â Mixed and Murky. Wake me in the spring. Follow the long-established fundamentals of home buying - pre-2001.

Dees, good luck with your negotiation. It's a good offer.

Nova, where do you get those stats and are they available for the NYC suburbs?

Laura, is the rise in your area due to the election and people moving in to take jobs

saphire wrote: Laura, is the rise in your area due to the election and people moving in to take jobs

No, that doesn't explain the sharp rise in activity in my zip. Most legislative aids, Hill staffers and lobbyists consider southern Fairfax Co wawaaaaaay too far out to live.

Just ask brickyeee, he'll tell ya. ;)

Specific to my experience only, the primary offer and the back-up that we have now on our property are both move up buyers from the area.

Saphire, our local Metropolitan Regional Information System which covers the DC area's MSMA is the source of a good chunk of the data I watch. ItÂs very local and doesn't cover NYC & environs. I don't know of a similar source that does.

I also look at the Census Bureau's American Community Survey (2005) for demographic information on my areas of interest. It's national in scope and you can do zip code searches to look at various demographics in a given area. I always hear what a wealthy area I live in and the income demographics help me nail down exactly what that means. You can easily google the Census Bureau's ACS site.

You may want to ask your question over on Ben Jones' very popular Housing Bubble blog. While the site is not without a few "tin foil" hat types posting, many smart, experienced, and insightful people post there. They may be able to point you towards housing data for your area.

It was through them that I learned about the huge mortgage fraud ring being run out of a favored restaurant in Ohio (used to live there)...very sad. The owners seemed so nice and they had truly great gyros.

Let's hope they put them to work in the prison kitchen.

LOL, kaleberg, if there's any justice, some prisoners in Ohio are indeed about to eat well.

I find the growing number of mortgage fraud stories in the news rather sickening. Makes you wonder the degree to which some of this high appreciation stems from fraud. Stay tuned.

"Makes you wonder the degree to which some of this high appreciation stems from fraud."

More likely suckers getting in at the end of a boom and stretching too far.
Many underfinanced folks purchased in the booming market ASSUMING it would not end.
They are finding out how wrong they gambled.

I have been nosing around for a few new investment properties, but the flippers have not been burned badly enough by carrying costs.
I know t least two people who purchased brand new houses with the intention of flipping them since the developments had almost fillied out. Both are struggling to make the mortgage payments.

"I don't think that lowballing properties because they were on the market since last summer is appropriate.
Many homes were stagnant since last summer. It WAS THE MARKET, not their house. People were freaked out thanks to the media."

Properties sitting are exactly what you look for to get bargains.
Stagnanant means the price was not low enough to attract a buyer.
The seller may be just digging a deeper and deeper hole as they sit on a vacant house and pay mortgage and taxes.
When they are broke enough, they will sell.

kaleberg wrote: Yes, houses are selling. However, the reason they are selling is that sellers are finally reducing prices, paying closing costs, making improvments, and offering concessions.

I disagree. Sellers have always done these things, more or less as the market dictated (i. e., sellers vs buyers market). If you really ARE knowledgeable of the NoVA market then you know that NOTHING was selling last Spring and Summer, traditionally the strongest selling season in any market. Yes prices have come down but buyers are coming off the fence because they see that there is NOT going to be a "tanking" so they had better get in while they can if getting in the market--or moving up in the market--is what they really want.

As far as "perspectives" on the nationwide market, I am a native Texan, and lived there for 26 years before moving to the East Coast but I would never presume to comment on the Houston market at this point in time. (And I would be willing to bet that it has been quite a few years since you attended Langley HS.) I have bought and sold a home in Baltimore Co, MD too--16 years ago. Does that make me an expert NOW on that local market?

I guess what I don't get is people who really aren't in this game at this point in time coming here and posting doom and gloom regarding the state of the RE market. Really, I am curious, why??? (And spare me the response that this is a public forum and anyone can post blah blah blah.) Any source that you quote is more than likely too global or, if it is blog based, it is agenda driven. And the REAL bottom line is, if you aren't buying or selling, it makes no difference!!! When my home was valued at over 900K (in 2004), it didn't really matter to me because I wasn't selling. So I just don't get someone who has no real stake in this coming here and saying, "The market is not picking up".

Thanks Laura and Nova

***"If you really ARE knowledgeable of the NoVA market then you know that NOTHING was selling last Spring and Summer, traditionally the strongest selling season in any market. Yes prices have come down but buyers are coming off the fence because they see that there is NOT going to be a "tanking" so they had better get in while they can if getting in the market--or moving up in the market--is what they really want."***

Laura, that statement is simply not true. Close to 21,000 housing units sold in 2006 in NoVa and IÂm not including Loudon or the other outlying areas. While 21K might be 30% down from the prior year and lower than any year since 1999, it isnÂt NOTHINGÂ as in Zero, Nada, Zed, Zip, Zipollo. In terms of sales, 2006 beats out most of the 1990s by a country mile. So, while NOTHING may be your perception, itÂs not fact.

Getting in "while they can" may be the motive of your buyers. Only you know that. But, itÂs not my motive, as a buyer, and one who is actively looking. So, please donÂt speak for me or the other NoVa buyers I knowÂ.our opinions and perceptions differ from yours. Your interpretation of this market is no more valid than mineÂweÂre all just reading the tea leaves and trying to figure it out. ItÂs not an easy time to be a buyer or a seller.

While your post may have been addressed to Kaleberg, you spoke to the forum so, I beg your forbearance in saying, yes, this is a public forum and you get to express your opinions. Why, youÂre even entitled to present them as facts.

You got me dead to rights. I read blogs. As a reader of this forum and a poster, I have an agenda. My agenda is to learnÂto learn by reading and considering an entire range of fact, thought, experience, and opinion from this big, wonderful, world of information. IÂve learned from you. You see, most of us buyers, do have two brain cells to rub together and we try to discern the wheat from the chaff. By combining what I learn with my experience, I hope to make the best possible housing decision for my family and our financial future. One personÂs gloom & doom is another personÂs smartÂitÂs all in the eye of the beholder.

In all sincerity, I wish you a successful closing tomorrow and hope the rotten weather doesnÂt get in the way. You have certainly experienced a trying market. With this sale behind you, the forecast for your new home will, surely, be sunny and bright.

novahomesick wrote: Laura, that statement is simply not true

Oh brother!!

Novahomesick, you know that I was not speaking *literally when I said that "nothing was selling" in NoVA last Spring and Summer. Ever heard of using exaggeration to make a point? @@ It WAS the slowest and lowest selling season in many years (at least seven) and since you seem to have numerous hours to spend perusing statistics and regurgitaing them here, you already knew that. I think you need to "relax"...

I don't know why you took such offense to my post, or so it seems, it hardly seems worth commenting on, imo...I certainly never took it upon myself to speak for you or any other NoVA buyer or seller, why would I?? You are reading something into my post that isn't there. I never meant to present my opinion as FACT (although I can see how someone with your penchant for statistics could think that) and I have always *tried to be careful to say "in my experience" or "just my opinion" in my posts. I never purported to be the "resident expert" when it comes to NoVA real estate--that title is yours for the taking, hon! Oh wait, you may have to duke it out with brickeyee first...lol All anyone can REALLY do here is share his or her individual experience...when Kaleberg said, "The market is not picking up", of course I am going to disagree because FOR ME that was not my experience...and judging from the posts that followed, I am not the only one.

I do stand by my question and puzzlement as to why anyone who is not really in the game at this time purports to be an expert in any local market besides their own and why they want to make blanket statements like "The market is not picking up" that simply aren't true.

And "doom and gloom" is just that...doom and gloom. Ya can't sugar coat it as "smarts". And doom and gloom isn't the same as reality--trust me, I know reality.

P. S. And if you keep answering for Kaleberg he will never tell just how many years it has been since he graduated from Langley HS....(wink)

Didn't mean for this to get into a heated debate about local markets.

Our bid was placed last night (long story) at $230,000 with seller paying $4,000 towards closing. They countered this morning with our choice of $239,000 with $4,000 towards closing or $235,000 without closing assistance. We agreed to the $235,000 without closing assistance. Would have paid for it any how.

I figured he'd stand firm at $240,000, which I was ok with. I'm very pleased with the results!

Thanks for all your comments!

Nice that they offerred you 2 choices, sounds like they wanted to work with you.

Congrats!

Congratulations....Good luck and keep us updated on the inspections and what not.

Thanks for the good wishes! The two choices was a nice counter and leaving it up to us was a wise decision on the seller's part. I think the listing agent wanted to make sure we got the house, since we've chatted with him on several occasions!

I'll post on our progress with inspections and stuff. We have a VA loan so things may be a little squeaky.

It's lovely to hear of a happy ending for you and the seller, both. It sounds like you, the seller, and the agent were all level headed, reasonable people committed to making a deal.

Congrats !! Meeting somewhere in the middle was a win-win situation. Good luck with the inspection!

Congratulations. As I stated earlier, $230,000 was not an unreasonable offer. It appears the sellers agreed.

Good luck,

Kevin