How Much Should I Offer For A Windsor Property?

Posted in Buyer Blog | 10/03/2013

Windsor Property

Windsor Property

First off, a real estate agent does not tell a client what to offer for a Windsor property.  They may suggest a range, but it’s always the buyer who determines what they are willing to pay for a home.  However, you can utilize an agent’s expertise and knowledge of the market to figure out what to offer.

A good idea is to find out why the seller is moving.  Yet, this information is not always available because the listing agent may not say anything.  But you can get this information at times even by asking the simple question, “When do you need to move?”  If they answer, “As quickly as possible!” then you can surmise that they are eager to sell the home.  But here are a few other suggestions to help you find the best possible price:

1.  What are the current market conditions?

Is the market in your neighbourhood a buyers or sellers market?  If it’s a buyer’s market, then you will have less competition and sellers might be more receptive to a lower offer simply because they are fewer buyers.

In a seller’s market, competition may be fierce so anything less than the list price may not be acceptable.  In fact, at this time, a seller may receive multiple offers that go above the asking price.  Therefore, your offer should be as attractive as possible.  Now is not the time to low ball.

2.  How much did seller pay?

This is important because if the seller bought a home in the last few years, in our depressed market, then they have not gained very much, so the listed price should be very close to what they paid for it.  True, they may have fixed it up and made various improvements, so it’s fine to adjust your cost for remodeling.

3.  What’s the mortgage balance?

Most sellers carry a balance on their mortgage and they are very unlikely to settle for anything less than what they owe on the property.  If a homeowner has left the property and it is vacant, then chances are, they are making two house payments, and so you can determine that they may want to sell quickly.  If the balance is low, then a seller might not be in a huge hurry to sell as they wait for the right price.

4.  Don’t forget comparable sales:

Comparable sales are exactly that: homes that are similar in size, age and location as the property you are considering.  Use this data from recently sold homes (within the last six months) to help determine what properties are going for.  A real estate agent can provide you with all of this information and let you know if you are overpaying.

5.  Has the listing expired?

Ask to see if a home has been taken off the market and put back on.  Why is this important?  Because if a home has been on the market for more than a month, the sellers may be more motivated to sell.  Homes that sit unsold for any good length of time, usually tells a buyer that the home is overpriced.

6.  Hire A Neighbourhood Specialist:

images-11You want a real estate agent that knows the neighbourhood in which you want to buy.  This is very important because they can quickly give you all of the information you need about a particular home.  You will learn if it’s overpriced, if there are any new developments or commercial buildings coming up that may lessen the value of the property, or a host of other valuable information that can help you select the right and proper price for a home.

7.  Get List Price To Sale Price Ratios

Your agent should be able to provide a report to see what homes were listed for and what they eventually sold for.  Determine the gap.  Are they over the list price or under?  By which percentage?  For example, if on average homes are selling at 3 percent under, then a seller may accept this reduction.

8.  Square Foot Costs:

Finally, what are the square foot averages for homes?  Are they on the rise or are they declining?  And remember, larger houses are priced less per square foot than smaller homes.  So you cannot take the amount and multiple it by the square footage of the home.  Talk with your real estate agent who can give you this information.

 

 

 

 

 

 

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