Making an offer

[Kgirl74]

Have found a house I am interested in buying. Looked into history and it sold for $568k in July 09. far as I can tell they haven't done any reno's to it since buying. The house is in Holland Park, Brisbane. Can anyone advise what a good offer might be as they have advertised late $500k's. I'm guessing $580k plus. It has only been on the market 5 days and is a nice house so will probably sell fairly quickly. I'm just not sure how much the market price would have gone up or down since July 09.

Thanks
Karen

 

[Edmond Dantes]

What does your research tell you? is it overpriced? how much are similar properties selling for now?

 

[Propertunity]

Can anyone advise what a good offer might be as they have advertised late $500k's.

A good offer would be less than the property's real value which may or may not have any correlation to the asking price

I'm guessing $580k plus.

Spending over $1/2 Mill on an asset and guessing might be fun but really, you need to (or should) know what you are doing

I'm just not sure how much the market price would have gone up or down since July 09.

You can find this out fairly easily by looking at: http://www.myrp.com.au/showProductDetail.do?reportTypeId=1&propertyId=
in which case you would see that in 2009 it went down 4.3%, up 10.1% in 2010 and up 1.8% so far in 2011, with the following caveats:
1. The price paid in 2009 was true market value and they did not pick up a distressed sale or on the other hand overpay.
2. The property is about average for the suburb, which it appears to be price-wise

The only way to truly tell is to find 6 other comparable sales in the same area and work it out from there. They have to be similar sized homes, with similar features that have sold in the last few months. This is the only way to establish true market worth.

 

[Ladyhawk]

Have you made an offer?
Without knowing the property I'd be very surprised that it has only gone up in value by 12k. That is not saying that it hasn't.
I'd say they would at least want to get what they paid for it...

Maybe speak to another agent in the area and find out what they think it is worth.

http://www.ljhooker.com.au/ask-lj-hooker/about-buying/finding-out-about-area-prices

I'm interested to know if you are successful.

 

[Andrew_A]

There's no magic answer, this is where a little detective work can go a long way in regards to sellers motivations, starts with just opening a conversation with everyone connected to the sale or living near the property.

If I was going to live there I would visit at various times of the day and night just to be safe, there are a lot of housing commission homes nearby including six commission houses directly connecting or very close to this property, should be fine but you'd really want to double check that. For an investment I wouldn't be as concerned as I'm sure this area will continue to gentrify and these houses will be sold to renovators or first home buyers at some point.

Don't want to discuss the numbers but a little digging here will bring up plenty of useful comparables. Even very nice houses aren't selling quickly if the price is a little wrong these days and sellers still think it's 2010, though property is still selling and anything that appeals to first home buyers or upgraders is much better placed than investor stock at the moment.

If Tracking Residex Monthly House Index for Brisbane

June 09: 12.10 $568,000
Mar 11: 11.98 $562,204

If Tracking ABS Quarterly Index

June 09: 142.2 $568,000
Mar 11: 148.3 $592,366

Assumes reasonable price paid initially and no value add (large assumptions and not a suggestion of value)

Good luck with your house hunting

 

[Andrew_A]

Just noticed the date of the first post! A little bit late with the reply