Real Estate, etc... by Eric Michael: Metro Detroit Home Buying FAQ: What Do I Offer for this House?

Metro Detroit Home Buying FAQ: What Do I Offer for this House?

Metro Detroit Home Buying FAQ: What Do I Offer for this House?

Right off the bat, I need to get something out in the open:

There is no such thing as buying a house for “pennies on the dollar.”

Pennies

Unless you mean like 97 or 98 pennies on the dollar. 

Even the days of “low-balling” are over. It’s just the way it is in this market.

The best way to determine what to offer on a house is to have your Realtor do a market analysis and explain what other similar homes in the vicinity have sold for recently.

You can also order an appraisal, which will cost you approx. $350-450. The appraiser will go into more detail, adding value because of more square footage, or taking away value because the basement isn’t finished and there’s only a 1 car garage.

Today’s real estate market is kind of strange. The inventory is low and a lot of times there are multiple offers on a house, making everyone give their “highest and best” offer. Almost auction-like.

Hope this helps!

Eric Michael, Real Estate Professional
Remerica Integrity, Realtors
41000 W. 7 Mile #105
Northville, MI 48167

Cell: 734.564.1519

Fax: 248.912.9996

www.ShortSaleInfoMI.com

www.EricMichaelOnline.com

Comment balloon 20 commentsEric Michael • June 05 2012 06:37PM

Comments

Eric, Glad to hear that your market is doing so well. Inventory is really low here too. We are taking buyers out tomorrow and are having a hard time finding someting to show them. Your give the perfect explanation on what to offer for a house these days, but they better do it quickly because houses are selling!

Posted by Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400, Long Island Home and Condo Specialists (The Top Team @ Charles Rutenberg Realty 255 Executive Dr, Plainview NY 11803) almost 7 years ago

only takes 94 to 96 cents on the dollar here.  (laughing)  I think we still have a bit more inventory is many price ranges.  200,000 to 300,000 not so much.

Posted by Tammy Lankford,, Broker GA Lake Sinclair/Eatonton/Milledgeville (Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668) almost 7 years ago

It seems there is low inventory practically everywhere these days.  Sellers, come out, come out, wherever you are - we have Buyers wanting to play with you!

Posted by Susan Emo, Kingston and the 1000 Islands Area (Sotheby's International Realty Canada - Brokerage) almost 7 years ago

Excellent advice Eric. Buyers in our area learn this quickly after loosing a bid or two.  It looks more like $1.20 here or more.

Posted by Anna Banana Kruchten CRB, CRS 602-380-4886, Arizona's Top Banana! (Phoenix Property Shoppe) almost 7 years ago
Eric, it's just like we always hear that real estat is local...but for sure it's not the market they we keep hearing about in the media.
Posted by Nick T Pappas, Madison & Huntsville Alabama Real Estate Resource (Assoc. Broker/Broker ABR, CRS, SFR, e-Pro, @Homes Realty Group, @HomesBirmingham & Providence Property Mgmnt, LLC Huntsville AL) almost 7 years ago

Eric, You read my mind....I was thinking sure you can...as long as that's about 95+ pennies on the dollar!  We might have a slight bit more negotiating room here outside of Ohio, but the principle is the same.  NO seller puts there home on the market looking to take 1/2 or even 1/4 off their price.  Writing those offers without a serious willingness to come up is about 99.99% likely to be a waste of everyone's time and just might burn a bridge between that seller and the buyers.  Funny thing, some sellers don't take well to insulting offers.

Posted by Liz and Bill Spear, RE/MAX Elite Warren County OH (Cincinnati/Dayton) (RE/MAX Elite 513.520.5305 www.LizTour.com) almost 7 years ago

So what your saying is that I can't buy that $200,000 for $100,000?  It's not a crazy stupid buyer's market like the media says?  Sellers aren't desperate and giving their homes away?  

Thank you for this blog.  You are absolutely SPOT ON!!  Good stuff Eric.   I hope all of your future buyers are reading this.  

Posted by Amanda Christiansen, Christiansen Group Realty (Christiansen Group Realty (260)704-0843) almost 7 years ago

Eric has his hand on the pulse of Real Estate...thank you Dr Eric

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) almost 7 years ago

Great Advice and you hit it right on the head. Great read for our local buyers! 

Posted by Graziella Bruner, Associate Broker - Serving Wayne & Oakland County (NCS Premier Real Estate) almost 7 years ago

Eric, nice post.  I like that "you mean 97 or 98 pennies"

Posted by Gary Frimann, CRS, GRI, REALTOR and Broker (Eagle Ridge Realty / Signature Homes & Estates) almost 7 years ago

Eric:  Congratulations on the Feature!  And congrats on meting out such good advice.  Buyers must be prepared and prepared well to offer sound pricings when they hope to buy.  The air of desperation that was touted by the media during the height of this recession is long gone.  You prove how important it is to be working with a true real estate professional.  Sound guidance and solid leadership ...

Gene

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) almost 7 years ago
If its not an auction - bid at least full price! At least in California
Posted by Rosemary Brooks, The Mother & Daughter Realty Team (BMC Real Estate - 209-910-3706) almost 7 years ago

More and more I give more weight to supply and demand...when the supply is short the comps don't matter.

Good post.

Eve in Orlando

Posted by Mike & Eve Alexander, Exclusively Representing ONLY Orlando Home Buyers (Buyers Broker of Florida ) almost 7 years ago

Eric, that is good news about your market, glad to hear it! Good luck with everything and thanks for the valuable post!

Posted by Adam Brett, The Adam and Eric Group, Fullerton's Finest (The Adam and Eric Group) almost 7 years ago

When running comps and CMA's there's a section of the data that is reported as a % of the listing price compared to selling price.  I always show clients this because it's a fair comparison of what is actually listed to what the sold price is.  Each specific location is different and property specific, but it sure doesn't show pennies on the dollar.  Good post Eric!!

Posted by Carla Muss-Jacobs, RETIRED (RETIRED / State License is Inactive) almost 7 years ago

Some people still trying to get away with a steal? Always best for a buyer to talk with a Real Estate professional like yourself. This way the know the actual market and can make an educated decision on the best possible offer to benefit the seller and buyer.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) almost 7 years ago

Eric - Great Advice! Buyers in my area might be able  to save one penny per dollar, but that's about it.

Posted by Michelle Gibson, REALTOR (Hansen Real Estate Group Inc. ) almost 7 years ago
Eric - It's so true that the days to lowball are over. There was a time for this to some extent, and it's no longer.
Posted by Christine Donovan, Broker/Attorney 714-319-9751 DRE01267479 - Costa M (Donovan Blatt Realty) almost 7 years ago

Whatever Eric tells you to offer.  BAM!  The lowball days have passed us by.

Posted by Justin Dibbs, REALTOR® - Ashburn Virginia Homes for Sale (Pearson Smith Realty) almost 7 years ago

Larry/Sheila, it's not that the market is well, it's that the inventory is low enough that the buyers have to make real offers.

Tammy, what's a few pennies among friends?

Susan, that's my aim right now. Find more sellers!

Anna, a lot of homes are going for over listing here, too.

Nick, it's is local for sure. I wonder how many areas are not this way?

BLiz, sellers totally do get insulted with low offers. Instead, they should view them as a starting point!

Jared, I do, too!

Richie, haha, thanks. I'm still working on my real estate "doctorate."

Graziella, thanks. Hope this turn around keeps going.

Gary, I'm serious about it, but I try to write with a little humour.

Gene, thanks! Working with a professional in every aspect of real estate is important!

Rosemary, full price is a good offer, unless the comps don't fit.

BB, the comps DO matter, when it comes to an appraisal.

Adam, thank, and good luck to you.

Carla, the list price to sell price is important, but I'm finding that more and more agents are listing homes way low to get the bidding frenzy started. Throws the % off.

John, that's exactly it. I'll tell people what I think will get a deal accepted and a lot of times they don't listen. They also don't get the house.

Michelle, thanks! Tell them not to spend that penny all in one place lol

Christine, like you said, those days are over.

Justin, I like your thinking!

Posted by Eric Michael, Metro Detroit Real Estate Professional 734.564.1519 (Remerica Integrity, Realtors®, Northville, MI) almost 7 years ago

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