When does price drop?

**bobblehead** · 11-29-2008, 02:06 PM

Hi, I am a first time homebuyer. I am looking for a small home for myself and son, and a fixer-upper/foreclosure (since its only me responsible for everything).

I looked at a couple homes in my area (the area I have been living in and am really comfortable with, its just a working class type neighborhood, but not alot of riff-raff, just smaller homes, nothing fancy, alot of homes built btwn 1900 and 1940).

There was a great home but I was too late, when I inquired, the purchase was pending. I was really disapointed, because it was PERFECT, and theprice was great.

There is another small (you know those tiny shoebox houses) one level, two bedroom with alot of charm-- hardwood floors, small porch front and back. Big garage. Small backyard, but cute. The neighbors look nice. The only drawback-- the bedrooms are small (thats ok), and the furnace is the old octopus, asbestos duct covered ones...I dont know what to think about that. And the price is high for what it is.

This house was on the market for something like 173 days prior. I saw it when the listing was expired. Then it came back on (a few days later) at the SAME price, with the listing saying it now has 2 days on the market (erasing the prior 173).

Does anyone have an educated guess at what is going on here with the listing/price? I would think they would want to sell asap (its a bank holding). Why the listing at the same price? When would you expect price to drop (i.e., how long to wait?).. Would expressing an interest keep the price up? I want to pay substantially less (the price for this/ for what it is/ is too high).

Also, does the price drop on foreclosed houses the more one gets into winter?

Any advice on how to handle this? I really like it...

I have been living in a rental duplex all my son's life (he's 13) and we need a home. Thanks.

**Codythebest** · 11-29-2008, 04:20 PM

Doesn't matter. Just make an offer that you feel comfortable with. That's all.
Beside, it's a foreclosure you said? Try offering 75% of asking and see what they say...

**bobblehead** · 11-29-2008, 09:00 PM

Thanks for your reply. I was thinking that I might have a better chance of getting the price I want if they lowered it again. I looked at the listing history and this house has been on the market almost a year from the bank (the bank's listing agency), and before that, it looked like the owners tried to do a short sale for about a year.

They had bought the house for an amazing amount (for the size, ect of the house) in 2002. It's a tiny house, they paid alot. Then they tried to get more than that amount in selling, then dropped their price a little, but no sale. The bank really went down from their price, but it is still too much for the house (there are much better/bigger homes for less, but this is the size/location I want).

The bank has stuck at this price, and I dont get it. I want to pay substantially less. From some of the threads on this forum, it seems as though the banks dont negotiate much more that 5% of their asking price.

Have you had experience in this? How do I go about this, or "feeling it out" via the agency?

Also I want to get a better loan officer, I dont think I got the best deal from the ne at my bank I called up out f the blue, and soeone told me to shop around. Can I make an offer with that pre-approval letter, and then change loan officers in the meantime?

Thanks.

**Mike Taylor** · 11-30-2008, 03:15 AM

Originally Posted by bobblehead

Have you had experience in this? How do I go about this, or "feeling it out" via the agency?

That seems strange to me, normally I see banks do pretty regular price reductions. Like Cody suggested, just make an offer and see what they say.

Originally Posted by bobblehead

Can I make an offer with that pre-approval letter, and then change loan officers in the meantime?Thanks.

Yes, there is nothing saying that the pre-approval letter is committing you to use any particular person or bank.

**rtibbs4** · 12-01-2008, 10:02 AM

Hi, I am a broker in MA and have been dealing with a bank on a few listings and I have noticed they are less motivated to sell quickly and are not coming down in their price as quickly as anticipated. I agree with the post above. Make the offer you are comfortable with and see what happens. If they say no you can always wait it out for a reduction and resubmit.

**minnesota-mls** · 12-02-2008, 02:42 PM

Here in Minnesota, many of the various homes for sale on the MLS (like the one you are describing) are being sold in multiple offers.

At least here in the MN real estate market, the market is shifting ever so slowly. It is still a very strong buyer's market, but bank owned and short sale homes that are priced to sell are in fact selling...often times in multiple offers.

Again, we have our agents do a good market analysis on the home and then we let our clients decide what makes sense to offer.

I hope this helps!

**FourtyTwo** · 12-11-2008, 07:44 PM

Another tactic you might try is to get a Realtor on your side who can pull up recent sales of local bank-owned properties similar to the size & features of the one you want to buy, but make sure to have him look for the ones that sold at rock-bottom prices. (These are usually the ones that have been vandalized because the house sat vacant for so long. You know the ones... windows smashed, copper ripped form the walls, etc.)

Perhaps showing the bank these comps will be a gentle reminder that they'll only get a quarter (or less) of their current asking price if they let the house sit too long and the thieves hit it, and maybe then your 75% offer won't look so bad...