Making an Offer-How Low is Too Low?
MN Homes– How Low is Too Low
Our team represents buyers on a weekly basis across many different price ranges and neighborhoods. The biggest question we get once the list becomes refined to the top choice is, “What should we offer?” This is the question that can make or break a buyer and their equity position down the road. If you don’t come in at the right price you can leave money on the table. Come in too low and you can irritate the seller to a point where they refuse to deal with you and you blow a great opportunity. Below are some tips to help you arrive at the right decision
1. Get current neighborhood data
The best way to determine market value is to look at what the most recent properties have sold for. The neighbors house who sold 18 months ago is no longer relevant to market value. In many cases the neighbors house who sold 4 months ago may not be relevant.
2. Find out how many pre-foreclosures there are
This can be accomplished in several ways. A Top Minnesota Realtor can help you with the process. Finding this information will be crucial in hedging against future market declines. If there are 5 homes in a 200 home neighborhood currently going through the foreclosure process, rest assured market values will take some huge hits in the next 18 months
3. Compare Apples to Apples
Many buyers we represent start out by assuming a walk out two story should go for a similar price as another walk out two story that has roughly the same finished square feet. Nothing could be further from the truth. A home that has solid stone surfaces with exotic hardwoods and sub zero appliances can vary tremendously from a track home built with vinyl siding and a basic finish
4. Hire experienced Realtors
A very important piece of any successful investment is hiring the right professionals. If you are investing say 250,000 in a mixture of stocks and bonds would you prefer someone who works part time and has had their securities license for a month? Or would you rather work for someone who has been in the trenches for a decade and learned by trial and error? The choice is usually simple when you put in perspective
5. Your opinion means nothing, look at the facts
An opinion from a person buying a home once every five years is seldom accurate unless its fact based. Opinions are the root of mistakes in almost all real estate transactions. Trust the facts and follow a fact based decision process. If it really comes down to opinions, get at least 3 opinions from relevant professionals that work the market constantly. Don’t follow a hunch.