Before coming in with a low ball offer. what are the ways to go about establishing a reasonable fair market value of the property?
What is a lowball offer?
- Thread starter exstatic
- Start date
Before coming in with a low ball offer. what are the ways to go about establishing a reasonable fair market value of the property?
There are many agents out there who turned up, paid the fee and picked up their license.
And since many have tried to pull the wool over my eyes many times, without any consideration if I were to lose tens of K's, I see them as fair game too
Hi Skuzy
You need to not only know direct comparables in your area of interest (I recommend purchasing the latest data) but understand the market well enough to "price" a home when you inspect it, before knowing the asking price. Some buyers will research their local market thoroughly enough (minimum 3mths+ of traipsing through opens, properties, talking to agents, other investors/buyers in the same area and knowing the differences in property types and particular locations, following sales campaigns to ascertain sales prices) to recognise a "good buy" when they see one and be able to act accordingly. Others will get stuck with a handful agents with whom they've developed a rapport and only ever see a limited amount of listings, restricting them from fully investigating the market.
Another point to remember is that, should you be active in the market for long enough as a serious buyer (or are purchasing multiples) you will get to hear about upcoming listings that may well suit. This takes time, however, and familiarity with a no. of agents in your local area- don't expect to be on their priority list simply because you've been looking for 6mths and know how to engage them in a good yarn
Time is also another huge factor- if you only have the weekends to look, then you're likely to miss out on a large no. of properties that aren't open for inspection (which is the majority) and getting a busy agent to show you a particular property on a Sat (in some parts of Sydney) is sometimes impossible due to their opens schedule!
At the moment you may well find vendors have already dropped their price several times to meet the market and so a particular lowball offer may well be rejected. Knowing the marketing history of a property can be particularly useful (and having access to RPData's "On the Market" feature is not only imperative for my business but also a real eye opener and guide to motivation of sellers) so, if you've been looking for a while, tracking properties during their sales campaign (though tedious and time consuming) is a really useful way of ascertaining current price movements. Keep property results from the major Sunday papers and you will begin to notice trends, especially with the larger agencies. But it does take time!
Hope this has helped somewhat.
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I agree. I usually compile market comparables together with recent lender valuations, then structure the offer in writing stating "That my offer is based on recent sales and lender valuation, therefore taking this into account, my offer is $**********".
We recently purchased a property on the market at 325k for 200k based on the above.
Bottom line is that they can only say yes or no.
We recently purchased a property on the market at 325k for 200k based on the above.
Bottom line is that they can only say yes or no.
I havnt had a chance to read the previous posts, though being an ex salesman myself, I say GO FOR IT!!!
From a sellers point of view, ANY offer is better than NO offer at all.
All they can say is no, cant they?
If they say no, you re-valuate your offer, and up it when YOU feel best. As long as YOU feel you pay a fair price, thats all that matters really isnt it?
Cheers
Mick
From a sellers point of view, ANY offer is better than NO offer at all.
All they can say is no, cant they?
If they say no, you re-valuate your offer, and up it when YOU feel best. As long as YOU feel you pay a fair price, thats all that matters really isnt it?
Cheers
Mick
