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- SIB
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January 20, 2009
Aggressive Offer Rejected
My husband and I need advice on a house. We made an aggressive offer of $550k on a single family semi-detached house asking for $659k in Madison (really Sheepshead Bay), Brooklyn. I included a note to the seller explaining how we reached our number. The comps in the neighborhood are around $590k to $630k (much larger lot), house next door and nearly identical sold for $600k in 2006 and construction costs to update the house (i.e. kitchen, 2 1/2 bathrooms, etc.) is at least $50k. The seller said that the price difference was too big.
The seller has lowered her asking price a few times in the last several months. She started in the 700k's (way over priced). We thought that she was motivated to sell but now, we are not sure.
What should we do? Should we make another offer of maybe $585k? That is the max because we won't have enough money left to renovate.
Any advice would be much appreciated. Thank you.
Author's Comments
I really appreciate everyone's comments. It's given me a better perspective on the whole buying process. I have faith that we will eventually find a house that is right for us.
Posted by: SIB at January 20, 2009 9:40 PM in response to Aggressive Offer Rejected
Thank you everyone for your feedback. We are trying to buy our first home so we are still learning.
Our offer was low and it didn't help that the asking price was $60k above comps. I keep hearing about over inflated housing prices and the beginning of a housing price correction, but I don't know if and when it would apply in this case. We will probably look for less expensive houses in other neighborhoods in the meantime.
Posted by: SIB at January 20, 2009 3:51 PM in response to Aggressive Offer Rejected
Responses to Author's Forum Comments
Seems like everyone is making a lot of assumptions when no one has seen the house or the comps. Seller may be right or wrong about what the market will bear but has no obligation to get back to buyer if they think the offer does not afford a basis for negotiation. Seller probably looked at the midpoint between ask and offer, didn't like it and declined to negotiate. Seller will be back if s/he needs to sell and received no better offers. You can guess all you want as to whether that will happen, but no one knows.
I am more concerned about your view that you can't go over a certain price because of anticipated renovation costs. Have you built in a 50% cushion on those costs? Do you have good estimates? Don't use the inspector's guess. If you must renovate to live in/enjoy the home, don't leave yourself without any room to handle cost overruns, change orders etc. Even at your "aggressive" price, this house may be too expensive.
Posted by: slopefarm at January 21, 2009 9:55 AM in response to Aggressive Offer Rejected
I meant too expensive for you. I am not commenting on the price compared to market.
Posted by: slopefarm at January 21, 2009 10:01 AM in response to Aggressive Offer Rejected
Maybe they owe more than what you are offered and they can't/won't go below that price.
Posted by: Adam Dahill at January 21, 2009 10:21 AM in response to Aggressive Offer Rejected
BHO - a lot of posturing.
Posted by: crimsonson at January 21, 2009 10:47 AM in response to Aggressive Offer Rejected
No one wants to read a note telling them why they should accept your offer that is so far below ask. Personally, I'd refrain from doing that in the future.
Posted by: Carol Gardens at January 21, 2009 11:20 AM in response to Aggressive Offer Rejected
Maybe they lost your telephone number.
Posted by: mopar at January 21, 2009 2:41 PM in response to Aggressive Offer Rejected
"BHO - a lot of posturing."
What exactly do you mean by that, crim? And stop stuttering!
I agree with CG at January 21, 2009 11:20 AM. Keep it concise and only submit your bid. Explanation available upon request. Mopar @ 2:41Pm makes a good point. Email the broker your phone number and bid one last time. As a matter of fact, all bids should be placed over email. Establish a dialogue and history that can be easily referred back to.
***Bid half off peak comps***
Posted by: Brownstones Half Off at January 21, 2009 3:03 PM in response to Aggressive Offer Rejected
Stuttering? That does not even make any sense.
"So what! Your objective is not to make them feel good."
You are posturing this robotic "cut throat" persona in dealing with a house purchase. The reality is, people buying a house to live (instead of investment) ALWAYS have a certain level of emotional factor built in - selling or buying. You can disagree the way it should but the reality is quite the opposite. I suspect your tips are based on lack of experience with actually selling/buying of primary residence RE.
Walking away and not bidding what you think the proper value are a fine advice but the rest of your tips is more appropriate for buying and selling stocks. If you think there is no difference between that and primary residence RE - then there is not much I can do.
Posted by: crimsonson at January 21, 2009 3:43 PM in response to Aggressive Offer Rejected
Where is Madison? Aren't there others houses for sale there now? Is there something specific about this house that you like? There are a lot of semi detached houses in Sheepshead Bay, why not look there?
Posted by: gab at January 21, 2009 11:03 PM in response to Aggressive Offer Rejected
"Stuttering? That does not even make any sense."
crimson[1]son[2]. Makes perfect sense.
"The reality is, people buying a house to live (instead of investment)"
Cop-out. Deep down inside, it's always an investment.
"your tips are based on lack of experience"
Talk about making no sense. Yeah, I have a lack of experience buying/selling RE but how can my tips be based on that? They're in fact based on the buying/selling experience of others whom I read about and my own negotiation skills honed in other areas of business.
***Bid half off peak comps***
Posted by: Brownstones Half Off at January 22, 2009 11:05 PM in response to Aggressive Offer Rejected
You should go to Barnes & Noble and check out Home Buying for Dummies to get general information. It will explain the different mortgages, what you are actually paying for in closing costs, etc.
In addition to the other neighborhoods mentioned, you may want to look into Ditmas Park.
Posted by: SIB at January 27, 2009 12:40 PM in response to First-Timer Questions