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How do you decide on an offer?
Topic Started: 30 Sep 2015, 11:14 PM (1,496 Views)
Chanman
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Hi all,

Just wondering what you factors you take into account when deciding on an offer? Do you ever quote what the buyer is asking? Do you use websites like onthehouse or propertyvalue etc? Do you ever pay for am evaluation prior to making an offer? How relevant is the previous sold price of the property?

I'm asking because I cant seem to get this science right. I use all the above plus looking at previously sold properties in the area, current market conditions.

I feel that the previous sold price + current market are the best indicators of the value of the house, and yet for some reason its always too low for the seller/agent.

Also what is considered a 'low ball offer'? Is there a numerical value for this i.e. >10% less than the asking price etc?

Thanks
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lulldapull
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Fake Chinaman, most of us don't bother with all these steps because you see our jobs are not guaranteed anymore.

We are not sure if we will have our jobs in the near future, let alone in the same industry, or city.

It's no more 2004 to 2008 Perth or Brisi mining boom scene. Times are different now.

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skamy
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Chanman
30 Sep 2015, 11:14 PM
Hi all,

Just wondering what you factors you take into account when deciding on an offer? Do you ever quote what the buyer is asking? Do you use websites like onthehouse or propertyvalue etc? Do you ever pay for am evaluation prior to making an offer? How relevant is the previous sold price of the property?

I'm asking because I cant seem to get this science right. I use all the above plus looking at previously sold properties in the area, current market conditions.

I feel that the previous sold price + current market are the best indicators of the value of the house, and yet for some reason its always too low for the seller/agent.

Also what is considered a 'low ball offer'? Is there a numerical value for this i.e. >10% less than the asking price etc?

Thanks
There are homes out there with keen vendors who offer low asking prices. If is a fallacy to think that you will get a low ball offer accepted in today's market. People are not in a rush and will wait it out if the market slows.

You are looking in Perth's best suburbs if you cannot afford them there are plenty of other good suburbs with good growth potential.
Definition of a doom and gloomer from 1993
The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
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GloomBoomDoom
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You look at how much you earn, times it by 3.5 and offer that.
MSE
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Reef
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Offer the lowest price you think the seller will accept.
It is situational. Think about the seller's situation.

Think about how long the house has been on the market, and what the market is like in that suburb. If houses are staying on the market for a long time, that suburb is probably going down in price. If you don't offer a low price, your house may be worth less than you paid.
Is it a great deal in a hot market? Then maybe offer the asking price quickly.

I look at the page visits on realestate.com.au and see how many people are looking at the house I'm interested in.

Think from the seller's perspective. Definitely not a science.
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newjez
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skamy
1 Oct 2015, 11:44 AM
There are homes out there with keen vendors who offer low asking prices. If is a fallacy to think that you will get a low ball offer accepted in today's market. People are not in a rush and will wait it out if the market slows.

You are looking in Perth's best suburbs if you cannot afford them there are plenty of other good suburbs with good growth potential.
You did didn't you?

Tell them how you did it!
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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Chanman
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Reef
1 Oct 2015, 12:50 PM
Offer the lowest price you think the seller will accept.
It is situational. Think about the seller's situation.

Think about how long the house has been on the market, and what the market is like in that suburb. If houses are staying on the market for a long time, that suburb is probably going down in price. If you don't offer a low price, your house may be worth less than you paid.
Is it a great deal in a hot market? Then maybe offer the asking price quickly.

I look at the page visits on realestate.com.au and see how many people are looking at the house I'm interested in.

Think from the seller's perspective. Definitely not a science.
Thanks, good advice. Especial the bit about checking how many people have looked at the property I'm interested in.

One rule that I follow, which makes logical sense to me, is looking at the property's previous sold price, looking at the changes in the market value of the suburb since the property was bought, seeing what value adding renovations/changes have been made by the new owners, and then deciding on a price.

So if a property was bought for a mil 5 years ago, and the median price for the suburb has gone up by 1% in 5 years, and the new owners have repainted the house but done nothing else, then logically the new price should be 1 mil + 1% + cost of painting (few Ks at best)?

Is that too simplistic a way of looking at it?

Thanks
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zaph
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Chanman
1 Oct 2015, 03:49 PM
One rule that I follow, which makes logical sense to me, is looking at the property's previous sold price, looking at the changes in the market value of the suburb since the property was bought, seeing what value adding renovations/changes have been made by the new owners, and then deciding on a price.

So if a property was bought for a mil 5 years ago, and the median price for the suburb has gone up by 1% in 5 years, and the new owners have repainted the house but done nothing else, then logically the new price should be 1 mil + 1% + cost of painting (few Ks at best)?

Is that too simplistic a way of looking at it?
I don't think that is a very good way of determining price.

1. The last buyers may have way over/under paid for the property.
2. Median values at a suburb level are way too volatile to have much meaning in the short term.
3. How do you know what renovations/changes the previous owners have made? - There are some ways, but it's not always easy.

I would rather look at recent sales in the burb and then adjust for quality/condition. That's pretty easy in a homogeneous style of housing and a lot more difficult in a heterogeneous style.

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Blondie girl
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Gee zappy.
You have some active brain cells in your answer .

A very good perspective generally.

Newjerk? can you try harder than dig up another person's blog. My first promo was with Billabong and my name in English is modified with a T, am Perth born but also lived in Sydney to make my $$
It's Absolutely Fabulous if it includes brilliant locations, & high calibre tenants..what more does one want? Understand the power of the two "P"" or be financially challenged
Even better when there is family who are property mad and one is born in some entitlements.....Understand that beautiful women are the exhibitionists we crave attention, whilst hot blooded men are the voyeurs ... A stunning woman can command and takes pleasure in being noticed. Seems not too many understand what it means to hold and own props and get threatened by those who do.
Banks are considered to be law abiding and & rather boring places yeah not true . A bank balance sheet will show capital is dwarfed by their liabilities this means when a portions of loans is falling its problems for the bank.
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zaph
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Blondie girl
1 Oct 2015, 05:15 PM
Gee zappy.
You have some active brain cells in your answer .

A very good perspective generally.

The gin didn't kill them all!
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