Our market is not seeing any lowering of prices and we are in your target range.

We so no reason to lower our price but then again we don't have to sell.

You can lowball or wait it really depends on the homeowner and their need to sell. If they have been on the market for awhile with no price lowering I would assume that they have no time constraints and can wait it out just like you.

Nothing wrong with your plan...But i seriously doubt any seller would agree to an 80% offer, unless the house is WAY overpriced...Waiting until spring, when you think more homes will come on market, may work in your favor, and it may not..Perhaps more buyers will also emerge,if interest rates decline,and then you'll find yourself not getting the deal you'd hope for...Best of luck in your search

The lisitng agent probably told us more than she should have, but these people are moving out of state. The family is split up and one person is stuck taking care of the place until it sells. Since they have worked to keep the house furnished I would never had known with out the listing agent.

Just seems to me to not be the type of situation where anyone would be happy chained to a property, especially a few hour plane ride away from where they are trying to persue a life and be with family, if they want to wait it out good for them, no skin off my back, but I think this might work. Of course it is all speculative on our part.

"Most of these people purchased at the peak and are trying to sell 100,000 or more over what they paid 4 years ago and equally well over the assessed value."

In my area, seldom is there a relationship between market and assessed value. Assessments are performed every 2 years and can be up to 4 years behind the market.

You can give it a go but don't be surprised if you either receive:
1) No Response
2) A counter that is full price or within a $1,000

I'm usually of the mind that there is no such thing as an "insulting offer" (those folks that walk through and do not offer are more insulting, at least the low ball offer liked my house... somewhat) but I think at 80% of list you are just wasting a lot of people's time. Get an appraisal. They may be off base, you might be off base, but at least this way you will know.

Oh, and don't count on the divorce helping you a lot. Many times divorce papers require a minimum price on the house before either party "must" sell. If your offer does not meet that trigger, either party has the ability to not bother with your offer or the court may not allow the sale. My ex almost sunk a deal over $250. Not everyone is rational in a divorce case.

If they bought at the top of the market, chances are their mortgage is also close to the top of the price they paid back then. It probably didn't come down much in four years. Maybe they CAN'T sell any lower if they don't have any cash to make up the difference.....

"Oh, and don't count on the divorce helping you a lot. Many times divorce papers require a minimum price on the house before either party "must" sell. If your offer does not meet that trigger, either party has the ability to not bother with your offer or the court may not allow the sale. My ex almost sunk a deal over $250. Not everyone is rational in a divorce case."

They are not divorced they are in different parts of the country because somebody has to keep up the house for sale. They are split up in the sense that part of the family is living where they are all going to be living and one person is having to stay here and shovel snow, dust, and other stuff to take care of the house on the market.

It is over priced. Not just for my preference but for the size/age of the house and the work that the house needs, combine that with a huge down turn in the market. It isn't that this house is our dream home it really won't bother me if they stay firm. THey very well might since they want to get a $100,000 profit, even after they dropped the price 60,000. I guess they paid high 4 years ago and thought they could sell even higher.

I think builders are the only ones who got the memo that it is no longer a seller's market.

What people think their house is worth and what buyer's will pay for it are 2 very different things. I know I am a bit black and white in thinking things are only worth what you could sell it for when you want/need to sell it.

If they don't like our offer I wish them the best but there are other house, this one is nothing special. Since the house has been on the market for so long even with the reduced price and it hasn't sold I feel a low ball offer is rather justified.

Ah I see on the one-moved-on, one remains. In that case, they may try and work with your low-ball offer.

I think builders are the only ones who got the memo that it is no longer a seller's market.

My area is still a seller/neutral market although now that winter has arrived it is shifting more firmly to a neutral market. There was an interesting article in the paper last week that quoted several local Realtors basically stating how buyers need to be educated in that the market in this area is not a buyer's market like the media keeps spouting for most of the country. Number of units sold in my area in 2007 is more than 2006 and both median & average prices have increased.

I'm not sure why people are sitting on a price with no movement in your area unless they do not need to sell or they need a certain price to not be upside down on the mortgage. One side has to blink eventually. Are you certain your market is a buyer's market and not a neutral market?

And, if this house is "nothing special", why bid at all?

We do think the low ball might take. It certainly is a buyer's market here. Most houses are dropping in price and most that have dropped have done so by about $50,000. At least I wouldn't consider it a seller's or a nuetral market if houses are sitting on the market (even well priced ones) for so long. We are just trying our timing and see what flies. Better to do it on a house that we could take or leave.

I would say the bubble started bursting in our area at the begining of last year. Construction has come to a major slowdown (hault in most nearby areas). The market went from houses being on the market for an average of 3 weeks and selling for well over asking price in bidding wars to houses sitting for over a year and not selling even wiht lowered prices. We really want to move to the town (better schools, shorter commute) more than the house.

We are willing to redo stuff if need be. Since there is no rush and there are other houses in our range and more appropriately priced this is just the one that would need the least amount of stuff done, but it still isn't worth what they are asking in comparison to similar homes.

Also since we expect more homes to come on the market after the holidays it really is inconsiquential if they keep their price. The worst they say is no. I don't think it is a waste of time to try. I am sure any offer, even if they say no, will at least seem better than no action at all.

Your first post said this "Where I live the prices are not going down and sellers are just sitting on an overpriced, unsold home"

Your last post said this "Most houses are dropping in price and most that have dropped have done so by about $50,000. "

Seems you are not quite sure what is happening in your market.

The town we currently live in (and everywhere else in this state) the prices are dropping rapidly. The town we are looking to move to, 15 miles away, the prices are not reflecting the changes in the market. Prices have changed in every other area nearby our desired location.

They are just sitting on their houses for lots longer. There are about 15 houses we would consider for price and area in the town we are looking in, but of those about 6 are priced reflective of the current market. The small town only has 60 listings and has had the same listings for the past 6 months or longer with no change.

All the towns surrounding that town, which share some of the same school system have lots of newer, nicer, appropriately priced homes but there are certain things that we just don't like such as the commute or the way the town is run. We have been watching the market for about 5 years and yep, the pendulum is very much on the buyer's side here, at least outside of this specific town.

The majority of the homes in this town are a 1,000,000.00 plus so the houses we are looking at are nothing special it is more the location.

I think seeing the very few in the desired town who have dropped their price reflective of the current market everywhere else and still not sell just tells me to wait it out.

The down turn has obviously registered in the days on the market. Of the 60 listings, over 20 of them have been on the market for over 400 days. The rest are about 190-400. These houses are not selling at the listed prices.

Only time will tell. Sorry for the confusion. We are not being expectant or ill informed.

I would think after so many months and the majority of a slow winter still ahead that our low ball offer (80% of asking in the $700,000-500,000 range) would be considered. If not, We don't mind waiting until more houses hit the market closer to spring.

I think this is what has to do with a lot of it.. price range.

People can't just get loans like they used to.

I think builders are the only ones who got the memo that it is no longer a seller's market.

Where I am, builders aren't budging. The only houses they are lowering is the ones people spec'd; permits were pulled, cabinets, flooring & other upgrades were done.. then they did not qualify for the loan. Base prices of houses haven't gone down, in fact they've increased.

The town we are looking to move to, 15 miles away, the prices are not reflecting the changes in the market. Prices have changed in every other area nearby our desired location.

They are just sitting on their houses for lots longer. There are about 15 houses we would consider for price and area in the town we are looking in, but of those about 6 are priced reflective of the current market. The small town only has 60 listings and has had the same listings for the past 6 months or longer with no change.

Is it possible for you to post where you are?

This is a rather public forum and I don't want to divulge too much because you never know who is reading what. I don't want to jeoprodize any potential transactions. I will post my where abouts after we close though.

Our current property (aparment building that we own and rent out) has drasticly decreased in value in the past few months. We got in just before everything started to sky rocket so even with a strong decrease in value we are still well above what we paid. Our current mortgage has always been covered by the tenants.

If we can't find a house that is "OK for now", we may end up buying something and tearing it down to build new. I am opposed to doing so because we have chronic medical issues in our home and it seems too draining. I would much rather find a livable property and go room by room at a comfortable pace.

Househunting,
Wow, I guess RE really depends where you live. If you offered me 20% less, I couldn't sell it to you.

I sold Jan/Feb this year (for 550k, at 50k below comps). I didn't have 100k to take off. My house only appreciated 4% a year. I'd been in it since 1994.

There were homes ridiculously priced around me. They are still not sold. Now, if you were offering 20% less on those homes, you would have been correct. There was one house that the guy was asking 899k(he bought it in 1994 for 300k). Now it's lowered to 699k. The house is worth in the high 400's. It's been on the market for 2 years...

our market also only appreciates 3-5% per year. In a seller's market sellers were typically getting 97% of asking. In our current market, because of all the foreclosures, housing prices have suffered. The only houses selling are those priced very low to compete with all the foreclosures. Right now if I were to list my home that I purchased 7 years ago and want it to sell relatively quickly, I'd probably only be able to list it for 10-12% above what I paid for it. The areas of the country with consistently low rates of appreciation on housing, don't have as much wiggle room for lowball offers. We never had the huge housing boom other areas of the country have had, but we're still suffering from the results of the bubble bursting.

Oh my gosh, one price just got decreased in the past couple of days! It isn't a house we want because of proximity to busy road and it is a newer home with a terrible layout, but it did go down $35000 this past week. This particular one has been on the market for 198 days so things are budging just slowly.

"See who blinks first" is what i hear often, but I will repeat that it's not always at it may seem.

A seller waiting 1 or 2 years to get $750,000 for their house will not really be getting the same value in two years for that $750,000. The same goes for a buyer. 'inflation' is a wonderous thing.

The buyer waiting/sitting with cash for a year or two is eating away at his buying power, UNLESS he is investing that money in higher yeilding instruments. If he is in fact investing the money, that isn't neccessarily a wise move to be investing during a time of possibly needing the money for a down payment of a house. What will interest rates be in one or two years? Me neither. It's a catch 22.

Also, if house prices in the surrounding are are better, except for this particular area that you like more because of commute, etc.. , then that is the reason why these people aren't budging as well. Other people know the "secret" to why you want this area as well as you do. Everything comes with a price. Even commute times.

If it were half the people sticking to their guns, then it might be just stubborn sellers. But if the whole area is doing it, then they might know the value of the area and want that return.

Also, people buy houses and put money into them. If you buy a house for $650,000, you may put in another $50 or $100k in repairs and upgrades while living there, but that doesn't show on the "purchase price" of the house 4 years ago. So you may think they want to make $100,000 more than they bought it, but they may have paid more than just the purchase price.

Good luck. My BIL is going through the same thing right now. Putting in low ball offers and wondering why they're not biting because the house has been on the market for "180 days!!". Someone will blink, but inflation might catch them both before it happens.

In my area, homes that are on a busy street are NOT usually used as comps for the rest of the neighborhood.
Typically, in the 500-700k neighborhood, the homes bordering a busy road go for 75-100k less than the same type of a house down the street. Also, they sit on the market for a long time.

I found a wonderful quote in today's Chicago Sunday Tribune. It was the lead story in the Business section (although authored by the RE section's columnist, Mary Umberger). It illustrates something we see every day in this forum.

Pennsylvania economist Joel Naroff is quoted: "The problem for buyers is that there is no such thing as 'the market'. Every community is its own special market, and each different submarket will bottom out at a different time. The bottom may be hitting the community next door to where you're looking to buy, but not the one where you're looking."

He feels the country as a whole will bottom in 12 to 18 months and defines this 'normalcy' being where the number of sales grows and prices are stable or rising. (I guess this is the same 'market' he said didn't exist? LOL)

Still, the same man just bought a house! It was what he wanted, where he wanted. The mortgage rate -- and costs! --were attracive, and he plans to live there for at least five years. The selling price was 25% under what the house would have brought two years ago, he says.

The article points out that builders are prime in bringing down selling prices. An amazing example was a $100,000 reduction in prices for homes to be built in Plainfield (40+ miles SW of downtown Chicago). That's a LOT of money, especially as a reduction on homes costing $360,000 to $480,000! Did it work? Well, buyers were in line to put down lot deposits of $1,000. (Not this chicken.)

Some big questions loom. Will there BE a 'spring market'? (Generally agreed to start after Super Bowl.) Will builders cease offering big concessions and reductions? What will mortgage rates and fees do? Biggest one: Will there be Recession?

The closing paragraphs are quotes from a Wharton School of Economics professor of real estate, Susan Wachter. She sees further turbulance in the economy as a whole. She says that for most people this is NOT a good time to buy a house; that prices will decline another 5% or more over the next period; that the market (that non-existant market again!) could bottom in 2009 (NOT 2008)...unless there is a Recession.

The OP in this thread may be low at 80%, but if there have been NO SALES and NO REDUCTIONS in six months in his community of choice...it does sound like everything IS overpriced. (Is that the case, OP?)

They may not be over-priced by 20%, though. There are only so many buyers for homes in a community of million-plus properties. I am seeing some 10% - 15% reductions in my town on million-plus homes that have over 365 DOM.

On the 'home as investment' side, might one be better off holding more RE and fewer dollars in an time of increasing inflation? (If liquidity isn't a problem!)

8 years ago we bought our multi-family home. 5 years later we refied and came it at double what we paid. We bought our current house because we had to buy quick. It was a 'decide as you look because it won't be here tomorrow' type feeling. We were buying it as a temporary home until we could feel out the area.

I worked at an appraisal office for a year right after 9/11 and the prices that year went up 17%. The year after they went up another 12%.

When we put ads in the paper for tenants, people kept calling wanting to buy our home. One guy hounded us for a year like a telemarketer. I considered a restraining order at one point because he was so persistent.

What goes up that fast must come down. There are a lot of people getting foreclosed as well. Factor in the credit crunch and the natural down that was bound to happen anyway with a buch of buyers who are sitting waiting and watching and it makes for some interesting fluctuations.

I am not waiting for the market (if it does exhist, LOL) to bottom out. I think just getting a house I like for the 10-15 years we plan on being there in an area I don't mind growing old in at a reasonable price is good for me.

I am not looking to find the deal of the century. We do have a comfortable place to live and we are happy to stay but we would like a yard, a better school system, lower crime rate, less trafic, shorter commute, and a better sense of community.

Thanks for all the great thoughts and information. I love this forum and find it so valuable.