Margaret, the way I look at it, it's a nice sized property, something I can live on myself. If I could afford to keep it for now I would. You just can't make more land is how I look at it. You said there isn't any comps. Is there any land for sale there that's smaller or bigger?

Why haven't you built on it yet?

There is a converted barn on it now; analogous to a mobile home, I guess. The only comps would be a couple acres with a mobile; but the ones I find to compare to all are under power lines or in a flood zone, so not really comps for our in a good neighborhood, on a hill, flat, treed parcel. And I could only find two unsold properties like that anyway, one for 155,000$ and one for 219,000$ (both 5 acres.)
We are living 100 miles away due to a job change (a good one).

Margaret

I'm not sure I agree that it's costing you so much to keep the property because a huge chunk of that is buying you housing, which is an expense you would incur anyway, unless you were dead and buried in pre-paid cemetery lot.

Can't you buy a house where you are and use your avoided rent costs to pay the mortgage instead, or do you need to sell in order to buy a house?

The true carrying costs seem to by about $2760/year, plus whatever lost opportunity cost you want to assign to the value of the lot.

Regarding comps: if the two other properties are unsold, take their asking prices with a grain of salt (they're unsold, after all), and remember they are twice as big as your property. Perhaps it's time to have the property professionally appraised so you can get a truer picture of what it's worth today in order to make your decision point clearer.

Molly~

Counter Offer them at a price you are willing to sell it for or a bit more, knowing there might be some back/forth negotiation and you will an to shave off some from the price each time.

If they offerred 150k, they are most likely will to increase this, since most people leave wiggle room with their first offer, knowing you will likely not take it and counter-offer higher.

So maybe you counter at 168...and maybe they counter back at 158 and maybe you then counter back at 164 and maybe they counter back and 160 and maybe you end of selling for 162k (can you live with this?). You never know how many "back and forths" there will be, or if they decide to walk or if you decide stick to a firm price and don't go any lower at a certain point.

You need to know your rock bottom price that you will sell it for and know that you are ok to see the buyers 'walk' if they don't want to pay this rock bottom amount. Don't tell anyone except your spouse this number (don' tell your agent or post on this board)

But if it was mine, I would counter back around 168k or 169k. It would be below 170, as 168k visually looks a heck of a lot lower than 170k.

Thanks for answering, everyone.

We can't buy without selling, no down payment. (We are not struggling financially, but coming up with 50,000 for a down isn't realistic and we are loath to go the "funny" mortgage route and end up with two properties and upside down on one of them.)

I considered getting an appraiser, but we seem to be one of those areas where an appraiser "hits the number." They are in the real estate agents' pockets. The property is assessed for 220,000$ and last year those numbers were running pretty close to selling prices.

My husband and I have decided not to go lower than 175,000$ (maybe 174,000$? I've seen some people on this board recommend countering like that.) That was our rock bottom price and it did get an offer; so who knows, maybe another one will come along before the end of the month.

Also, although the offer was represented over the phone to me as "cash", it would be equity from the buyer's home and still has a financing contingency and an appraisal contingency, as well as a feasibility contingency (and only 1000$ earnest money.) I would be more likely to say yes if the guy actually had money in the bank and wanted to close next week.

Oh, and our agent is working both sides of the deal, so I have to take what he is saying with a grain of salt, also.

Margaret

It doesn't seem that you are 'between a rock and a hard place' -- don't *have* to sell pronto. I think you already said what your bottom price is: It's $175K. I'd counter with that. If they really want it, they'll pay. If they really want a steal, they won't. (As you've said, they don't have the cash until they sell their home -- another big maybe.)

Do you ever see yourselves building on this property? Or are you now viewing it as an investment, hoping it will increase in value?

Chisue,
No, we aren't ever going to live there again. We are looking at it as an investment.

If it went back up to its supposed "worth" of 240,000$ in the next 4 or 5 years, that would be more than we could make on other investments.

Of course, if it went back up in price, probably anything we bought where we live now would go up in value also?

The only real reason to sell now would be to buy something here. We would like to own our own home again, although we aren't unhappy in our nice rental house. Our last rental house was sold out from under us though, and we ended up in apartment for a while and that was HORRIBLE.

So, it's really the insecurity that bothers us.

Margaret

One thing to keep in mind, at our current "true" rate of inflation of about 5-6%, $170,000 today is the same number of real dollars as $240,000 six years from now, I think. That assumes property does indeed go back up and not just stagnate.

When people talk about the bubble bursting in real estate, some of that decline can be attributed to loss of value over time. So you could have $100,000 in real estate drop to $50,000 overnight for 50% deflation, or you can have a property worth $100,000 today be worth exactly that same amount 10 years from now, but due to inflation in "constant dollars" it's really worth half what it used to be (I bought my first home in '96 for exactly what the owner had paid 10 years prior, so it's not unrealistic). Or, it could be a mix, say $100,000 dropping to $80,000 over four years, a much bigger loss than the $20,000 it seems to represent on the face of it.

Anyway, hold onto the property if you like, just beware that if it is an investment even getting back up to $240,000 is only keeping place with inflation.

Flip side is that if worst came to worst, you can go live there!

greenbank - thank you so much!! Your perspective on inflation and property values over time has really opened my eyes. I am re-thinking all my decisions over buying or selling now.

That fact that that the property is in the "exurbs" may have a bearing on its future value. Exurbia usually means a long commute to work and high gas costs. At today's gas prices, your land would be less desirable to many people because of the commuting costs. That is likely to mean it's value has dropped relative to closer-in properties, which are more in demand.

Do you think it's likely that we'll continue to see high gas prices? If so, then it follows that the property is much less likely to reach the value in inflation-adjusted dollars it supposedly had a few years back.

So I don't think it's realistic to hold onto it in the expectation it will go back up in value.

If you want an appraisal, get an independent appraiser. The bank's appraiser will always appraise at the contract price, as you found out.

I might try to negotiate, like sweet tea suggested, but I'd be inclined to try to make this deal work.