April 26th, 2011 1:00 PM by Uletas Greene Carter
One of the most important decisions homebuyers face is how much to offer for their home. Buyers think they need to run spreadsheets or do fancy math to make a smart offer.
But the fact is, there is a list of steps you need to take to make a smart offer, one that gets you a great value, but is also likely to be successful at getting you the property. Remember, a low offer does not make for a great deal if you don't get the house.
Look for comparables that are very recent sales, very similar properties (same number of bedrooms, bathrooms, square feet, and similar style, condition and amenities). If you do get into a contract, these may be the same comparables which will be considered by the appraiser. The Market Analysis will provide the following
Buyers, it's a must to make sure that your offer price for any given home falls within the range of what is affordable for you. This includes offering a price within the range for which your mortgage was preapproved, but also includes making sure that the monthly payment and cash you'll need to close the deal (down payment plus closing costs) are affordable in light of the particular house. If the property will require repairs for which you'll need extra cash, you'll need to restructure your offer accordingly.
The more competition you have as a seller, you should make small adjustments to your list price to attract buyers to come see your home because the more buyers who come to see your home, the more likely you are to get an offer.
Buyers should also be aware of the competition level you will face for homes. Even in today's market there are properties and neighborhoods in which multiple offers are the name of the game. Work with your agent to understand the list price-to-sale price ratio, which lets you know how much under or over the asking price properties are selling for in your target home's neighborhood.
Your agent can also brief you on the following:
Sellers -- most buyers are not in a high state of urgency to buy these days, given the long-term, high affordability of homes and interest rates, except when they have an urgent personal reason for moving, for example, buyers who are relocating for work.
Sellers, think of your list price as the most powerful marketing tool at your disposal. If you really want or need to sell, get aggressive about setting your price as low as makes sense for your home's value and local market dynamics to attract qualified buyers and help your home stand out against all the competition.
If you are thinking of buying or selling, please call Uletas Greene Carter today for a free market analysis (626-388-1500). Licensed by the Department of Real Estate #01045375