How do I determine my initial offer to buy?

There is really no steadfast rule when making an initial offer. However, be aware that when you do make that initial offer, it usually sets the sale's price of the home.

When I coach home owners prior to selling, I tell them everyone wants something from a deal to make the transaction happen. This means sellers really need to give something and the buyers also need to give a little as well…..so when setting a price as a seller, you want to make sure to leave room for that to happen. And as a buyer, know that you also will need to be reasonable…negotiation!

When you find real estate to buy, ask questions, check comparable properties and talk it through with your Realtor before making the initial offer. I personally keep track of my area's selling price’s - to initial list price on a daily basis. This gives me valuable information for my buyers AND seller's. For example, 91 % average selling price to list price can be important information for both sides and gives me just one additional way of determining an initial offer OR a selling price for my client(s). In addition, I will also study comparable properties that sold in the same area. I will add or subtract value for one feature or another including location and condition in addition to features that I find to be of the most value.

Using these methods can only improve your ability to determine a value range. Consider what you can afford and make an offer that you consider to be fair, remembering that giving a little in the negotiation will improve your chances of acquiring your dream home!

Posted at 07/12/2011 02:24 PM by David Sampson

Categories: Buying