I’m in the market for my first home purchase & see adds for homes listed between a range of prices eg. $150,000 – $180, 000.
Obviously the more I offer, the greater my chance of securing the purchase, but I don’t want to sound over-enthusiastic & don’t want to pay an unrealistic price.
MY QUESTION IS: When making an offer on a home is it best to bargain with an initial offer of say $10, 000 below the sale price then negotiate upwards ? Is this the usual approach ?
i work out what i think it might cost me to bring it up to scratch, and offer that much less, it looks like you know what you are talking about, and they start thinking you might just have a valid point, and hopefully meet your offer or come close to it.
I always start low, you never know how motivated the vendor is to sell and you can always work your way up to a mutually acceptable deal if you wish to. [
] HGHi all
I myself have not got any first hand experiance of offering but there are i believe a number of factors.
1) Is the sellers motivation allready covered before..
2) Costs to bring it up to scratch also covered before.
but… finally i think there needs to be a more formal system as far as an offter goes , i believe you will find this I HATE ENDORSING products but with steves lemon pack i think its called that but it guides you through all the steps of buying well worht the 60 bucks as i have heard echoed throughout the forum.
You can find it at https://www.propertyinvesting.com/BuyerBeware
This reffers to due diligance templates.
Hope this helped
Regards Josh…[
]Todays market is a “sellers market” [
] not a “buyers market” . Good luck with the “starting off low” but I think that if you like the house and it adds up then – buy it. If not, wait until it’s a “buyers market” [] – which should be coming up very soon (don’t quote me on that).You can often work out a basic rule of thumb that each bedroom is worth X, the garage is worth X and so on (obviously differs with each area), but if you are paying for your own valuation (as opposed to the bank) pump them for all the info and if possible be there when he does the valuation. Offering ridiculously low amounts is a waste of time in this market, be realistic and more importantly be persistent. I have absolutely no experience with buildings so I drive my valuer, pest inspector and building inspector crazy (though I think they dont really mind) and now I feel confident enough to do my own (though I wont) but it sure makes things easier, I set my limit and when it is reached walk away from the deal. Interestingly enough they have always got back to me. Cheers
Some questions I always ask are:
Who priced the property?
Why was the property given that price?
Why is the property being sold?When buying our last property we also mentioned that we would like to renovate and on sell quickly. Plus we were thinking of selling our other IP’s. (A big fat lie) But the fact that the sales agent thought that he would be selling this property again real soon and with the prospect of a couple more made him favour us in the negotiations.
Another tip is to offer an odd figure. Instead of $220,000 try $219,400. It looks to the seller that you’ve really tried to scrape together your last cent to buy their house.
Happy negotiations.
V
Hi Broons,
If there is a list of things I have learnt from my brother Bill, the following bits might help you to reach a proactive decision in negotiating. It worked for me.
1/ Make only one informed offer. If unaccepted, walk away. They will chase you when they realise you are serious. This places you in control and self qualifies you from others just throwing their hat in the ring. Don’t try to steal a property. Someone else will be out there, prepared to pay the market value. Remember, the market value is only a reflection of what someone is prepared to pay. It is not a measure of what a buyer can afford.
Forward ..
2/ Don’t use figures like $219,400 just to tell them what you can or can’t afford. Just because it’s all you can afford does not mean that someone else can’t afford it. Use $219,400 if you tell them that is the figure you believe it is worth. Let them think you can go to $250,000.
Regards, Phil
Hi Broons,
In addition to the previous posts you could also consider;-
A r/e agent once told me that when a seller advertises within a price range the seller is hoping to achieve at least 75% of the difference between the low & the high price added to the low price. I don’t know for sure whether this is the absolute truth, but it does sound feasible.
Price range of $150,000 – $180,000
Price difference of $30,000 x 0.75 = $22,500
$150,000 (Low Price) + $22,500 (75% of the price difference) = $172,500So $172,500 is the price the seller is hoping to achieve, but not necessarily what you should offer.
I have also added a link to a site where you can buy VGO past sales data for the particular area you are researching. It costs $33 for a report & you can compare the past sales information to the property you are considering. The report is e-mailed to you instantly. The downside is that the information is usually approx 1 month out of date, so in a fast moving market you need to take this into consideration. You can also get the same reports directly from the VGO, but you have to physically go there, as they do not as yet have an online ordering facility.
Cheers
KymOne time a real estate agent from Bendigo told me that what they do is they take the value the vendor wants to sell the property for, and then goes 1/3 upwards and 2/3 downwards to get the price range, or was it the other way around?[
]Anybody know?
Fudge111[8D]
] HG
]
] not a “buyers market” 
. Good luck with the “starting off low” but I think that if you like the house and it adds up then – buy it. If not, wait until it’s a “buyers market” [
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