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#466065 - 11/01/19 01:09 PM Advice on what to offer
jn1204 Offline
Junior Member

Registered: 11/01/19
Posts: 5
Loc: USA
I am looking at a house on a beautiful property. The list price of the house is listed at $740k. The owner bought the house just last year at 578k. The house was listed for a year before the owner purchased it and it was listed at 699k then. Its a 2 bedroom on 34 acres. We would have to add a 3rd bedroom right away. The sq footage listed is off by 1300sq ft because it must be including the garage and the screen room. When the owners bought it last year it was listed at 3000 sq ft and he didn't expand the house at all. Now it is listed at 4300 sq ft. The most he did was add some stereo equipment and light fixtures to the house. Where should I start with an offer knowing what he paid and knowing he probably started his offer last year lower than what he purchased it for. I don't want to offend the owner, but also think his asking price is off by a lot. I know he probably at least wants to get his 5% realtor fees back as well. Thanks in advance for any help!

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#466066 - 11/01/19 01:46 PM Re: Advice on what to offer [Re: jn1204]
Long Walk Online   content
Member

Registered: 06/27/08
Posts: 401
Loc: New Hampshire
You should be having this discussion with your agent.

If you don't have an agent, you might want to get one.

If you insist on not having an agent, I wish you well. Somehow you have the financial strength to buy this property and don't know the fundamentals of negotiation.

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#466067 - 11/01/19 02:21 PM Re: Advice on what to offer [Re: Long Walk]
jn1204 Offline
Junior Member

Registered: 11/01/19
Posts: 5
Loc: USA
I have had this conversation with my agent. I have also talked to a contractor and got his advice. I was interested in how others would view the situation compared to my agent. Just to have other perspectives.

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#466068 - 11/01/19 04:06 PM Re: Advice on what to offer [Re: jn1204]
Long Walk Online   content
Member

Registered: 06/27/08
Posts: 401
Loc: New Hampshire
Got it....you don't trust your agent.

Again, I wish you well.

All your points above finished space, the seller's purchase, and your need for a 3rd bedroom are irrelevant to the conversation.

Bottom line: you want the house, but think it's over-priced.

Solution: buy the next best property on your list or make your best offer on this one and hope the seller sees things your way.

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#466073 - 11/02/19 01:03 PM Re: Advice on what to offer [Re: jn1204]
Bigtoe Offline
Major Contributor

Registered: 10/14/07
Posts: 2397
Loc: Outer Banks
What the seller paid for it is irrelevant. The only 3 things that matter are what the current market value is, what you are willing to pay for it and what the seller is willing to sell for. These 3 things don't alaways match up.

If the seller was selling for less than he paid for it then you would not even be taking this fact into consideration so forget what he paid.

what is the market value of the entire property right now? This is what it is worth.

Are you willing to pay more than it is worth?
_________________________
Your Outer Banks real estate agent. Helping people buy and sell OBX real estate since 1989.

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#466076 - 11/04/19 02:22 PM Re: Advice on what to offer [Re: Bigtoe]
jn1204 Offline
Junior Member

Registered: 11/01/19
Posts: 5
Loc: USA
Would you mention in the offer about the sq footage being off?

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#466077 - 11/04/19 09:42 PM Re: Advice on what to offer [Re: jn1204]
Long Walk Online   content
Member

Registered: 06/27/08
Posts: 401
Loc: New Hampshire
[quote=jn1204]Would you mention in the offer about the sq footage being off? [/quote]Do you want the house? Are you willing to pay what it takes to get it? If not, move on to your next choice.

None of your arguments can be expected to move the seller. Reverse the roles - how would you respond to this? If there are really as many major factual errors in this listing, how do you suppose it even got to the market? Don't you think the listing broker might have done some due diligence? Don't you think there might have been an appraisal that the seller is relying on for certain facts about the property? And your evidence of the errors is the tax assessment? Do you know what those rely on in that jurisdiction?

Do you know what the seller cares about? It is not the same thing as you.

If you want the house, make an offer.

But you still puzzle me...you clearly have no idea how to negotiate anything and you are trying to buy a $750K house....where is the money coming from?

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#466078 - 11/04/19 10:11 PM Re: Advice on what to offer [Re: Long Walk]
jn1204 Offline
Junior Member

Registered: 11/01/19
Posts: 5
Loc: USA
The selling agent says they are using the township sq footage from the tax assessment. He says he doesn't know how they figured it out, leading me to believe they did not do any due diligence in this manor. The blue prints that are in the house say it is 1758 sq ft main floor, 210 screen porch, 1125 sq ft basement finished and 305 sq ft unfinished basement. The blue prints are close enough to room sizes to know it is decently accurate.

I was looking for advice (I'm not in real estate for a living), sorry you took some kind of offense to that.

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#466079 - 11/05/19 11:44 AM Re: Advice on what to offer [Re: jn1204]
Bigtoe Offline
Major Contributor

Registered: 10/14/07
Posts: 2397
Loc: Outer Banks
You still haven't said what the current market value is. How much did your agent's cma say the house is worth? Without this number you have no argument because the sq ft of the house is almost irrelevant seeing as it sits on 34 acres.

Pointing out the sellers mistakes is not a good negotiating strategy. You have to argue value. What is the value of the property today?
_________________________
Your Outer Banks real estate agent. Helping people buy and sell OBX real estate since 1989.

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#466080 - 11/05/19 01:06 PM Re: Advice on what to offer [Re: Bigtoe]
jn1204 Offline
Junior Member

Registered: 11/01/19
Posts: 5
Loc: USA
The CMA comps with adjustments ranged from 500k to 640k.

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#466081 - 11/05/19 01:31 PM Re: Advice on what to offer [Re: jn1204]
Long Walk Online   content
Member

Registered: 06/27/08
Posts: 401
Loc: New Hampshire
I understand that nobody has talked with the listing agent to see where the square footage estimate came from.

But, has anyone talked to the assessor to see when the last interior inspection and the last full measure and list were done? My guess is no.

Next, what does land sell for in estate lots in your market? Ignoring the improvements, the range of value you gave below equates to $14,750/acre to $18,800/acre. Unless much of that is wetlands or if the property is out in the boonies where there are no buyers, that seems like what I would expect to see in many New England markets - sounds like you are in the NJ/PA area, so land may be worth even more....but your agent would have to know this. Add the house and you get the list price.

If you really want the house, it is time to ask the listing agent for the support for the square footage. Depending on the answer, you will know what to do.

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#466086 - 11/06/19 12:09 PM Re: Advice on what to offer [Re: jn1204]
Bigtoe Offline
Major Contributor

Registered: 10/14/07
Posts: 2397
Loc: Outer Banks
Be careful pointing out what you see as something the seller or listing agent did wrong. This only creates animosity which gets in the way of negotiating.

play dumb and tell the listing agent you don't understand how they came up with their price and ask them for their cma. They might have comps that you missed or they could tell you it is a pie in the sky price. Either way you will then understand their mindset.

If this is a must have property be prepared to overpay for it.
_________________________
Your Outer Banks real estate agent. Helping people buy and sell OBX real estate since 1989.

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#466099 - 11/07/19 03:45 PM Re: Advice on what to offer [Re: jn1204]
barb43 Offline
Veteran Member

Registered: 08/01/08
Posts: 1169
Loc: SW Okla
Originally Posted By: jn1204
Would you mention in the offer about the sq footage being off?

Here - and I can only tell you what we do in Oklahoma - it is perfectly acceptable for the listing agent to use the county assessor's sq footage. County assessor's here do not return for interior assessments, unless a place is destroyed & rebuilt & they somehow get word of it. We do have a form that is one of the disclosures on which we state the sq footage & checkmark the location we got it from. Agents are not required to measure the living area of a home. In fact, buyers are encouraged to measure the house themselves, if they think it's not accurate - of course, they need someone's help to do that usually so their agent should know what's counted in sq footage and what isn't.

Good luck on this. Grill your agent until he or she answers all of your questions and concerns.
_________________________
Remodeling houses & helping tenants get ahead in life since 1983. Licensed Realtor since 2005.


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