It's a matter of public record.
Once a house is sold, that purchase price is recorded in the land records of the city or county where it was sold. The whole world can see what Sally and Tom paid for their new house. When it comes time for them to sell, many potential buyers will be asking this question:
HOW MUCH DID THE SELLERS PAY?
9 times out of 10, buyers I work with ask this question. Whether the sellers have lived in the house for 3 months or 32 years, buyers want to know. As the tagline for a popular supermarket tabloid used to say, "Inquiring Minds Want to Know."
While this amount can sometimes give an indication of the position of the seller, more often than not it does not make much difference at all. Sometimes the public record will show that a seller paid a very low price for a home compared to its value today. However, it may not display the fact that the seller has refinanced a couple of times and now owes more than they'll be able to net from a sale. Other times, it may appear that a seller would need a short sale because the value is so far below the previous purchase price. This may not be the case if the sellers used a large down payment to purchase the property.
The key thing to remember is that the today's value has almost nothing to do with what a seller originally paid for their home.
The market value of a home is the estimate of the most probable price that an item will bring in cash in an open and competitive market assuming reasonably informed buyers & seller, unrelated buyers & sellers, and property exposed to the market for a resonable amount of time. That's the textbook definition.
While one can ask what the sellers paid, the reality is that the price the new buyers will pay is determined by the market and the sales that have occurred most recently. It may be interesting to know what the sellers paid and speculate until the cows come home about their motivations to sell, that number has very little bearing on today's market value.
The only question buyers should ask themselves is instead:
HOW MUCH AM I WILLING TO PAY FOR THIS HOME?
Your experienced REALTOR can help you with making an informed decision.
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I don't get this question often because when reviewing listings, I give the buyer the information with an explanation of what it might mean. I also let them know that it may not reflect the actual net proceeds that the seller would be receiving.
What the seller paid for a property doesn't disclose how mucy they owe.
I looked at one yesterday that showed the buyer paid $110,000 ten years ago. However, he had refinanced and took out $50,000 in 2007. Fact is, he has no equity.
So, what difference does it make what he paid???