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I Want a Deal

Columbia, SC Homes For Sale Well of course you do, in this day and age who doesn't? But the fact of the matter that all "deals" are relative to the situation. Your perception of what good deal is can be very different than than what the market says is a good deal.

These days with all the fuss over foreclosures, every buyer that makes their way off of the proverbial fence is looking for that turnkey home that's is pristine condition. They also have their minds made up that they are going to get that beautiful home for next to nothing due to the desperation of the economy.

Columbia, SC Homes For Sale Well, the fact of matter is that you may not see a good deal for what it is if you are paying attention to the market. Your money may not buy a mansion on a hill just because the market is not a hot as it once was in the past. You still pay market value regardless. Take those wonderful foreclosures for example. If a decent one hits the market in my area, they have multiple offers within a few days and they don't have to accept your low ball.

While no one likes to feel that they are being robbed in the process of making a purchase, you still have to accept the fact that not every market is desperate. Some are doing well, and here in Columbia a good home at a good price is still going to get a good offer. You have to be realistic about what you can accomplish. While you can get a great deal on a home compared to the price of that same home a couple years ago, you still have to pay market value for it today.

Columbia, SC Homes for Sale

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JL Boney, III - Columbia, SC Realtor - Russell and Jeffcoat Realtors

I specialize in Columbia, SC real estate and the surrounding areas, including Blythewood, SC, Kershaw County, Fairfield County, and Lexington, SC. If you are in the market to buy or sell a home in Columbia, SC or any of the surrounding areas, I would love the opportunity to speak with to see how I can help. Thanks for reading and feel free to contact me if I can be of service to you.

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Posted by JL Boney, III Columbia, SC Real Estate on 11/10/2009 12:12 PM

Comments (81)

Advice to Buyers in the Home Buying Channel

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Originally posted at: JL's Columbia SC Real Estate Blog: I Want a Deal

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81 Comments on I Want a Deal

NOV

What a great way of looking at things I think everyone is looking for a good deal-you are right it all depends upon you the individual and the market.

JL...That proverbial Deal. I have a client that has been on the fence about one property. Finally wrote yesterday, 5% under list. Today, we find ourselves in a multiple situation, so my client is now offering $1000 over list.

Waiting for that deal isn't always smart. You also need to recognize a deal when you see one!

JL --- good information here --- I agree with William --- hopefully your potential clients are reading your blog.

JL - A deal is one that is culminated not one that is fantasized. Throwing unreasonable low ball bombs rarely result in a culminated deal.

JL: I had to fire some "bargain hunters" this past summer. Their expectations of what they could get and for so little, were a waste of everyone's time. At least they stopped wasting mine.

JL...

In our market you can find deals but you have to be willing to over look a few perks. What perks you may ask:

Refrigerator

Dishwasher

Stove
Kitchen Counters

Ceiling Fans

Light fixtures

Doorknobs

Toilets

AC System

Pool Pump

So, you're probably wondering what happened to those items. Well, the seller's take them just before the banks take the houses back. Does it suck? Of course. But, you sure can get a deal :)

TLW...ROAR!

You are so very right. We have pockets of markets, and segments of markets, that are doing quite well here in the Northern Nevada area as well.

Northern Virginia is also doing well. It doesn;t mean you can't "get a deal" but you are not going to get a "steal". Good prices all around.

Hi JL. Deals are all RELATIVE and they come with negotiation, or they may not come at all depending on the laws of supply and demand.

JL to me a good deal is when the seller and the buyer are both happy with the end results ...great post ...peace zane

JL...

You are so right. Real estate is local. I'm glad to see you back on the featured page!

JL,

Right you are, my man! Congrats on the feature.

Mike in Tucson

p.s. Are you a USC Columbia campus grad?

JL - There are good deals, if you know your market, and act quickly based on market knowledge. If you are "shopping" and not working with an experienced agent, your odds of finding a "deal" are greatly diminished. Great post.

Hi JL~ Sometimes we have to verify if they are trying to get a deal or a steal......

Everyone wants a deal in real estate, but I think that a deal is in the eye of the beholder.

JL, Truer words were never spoken! Pocket markets are all over Charlotte, and frankly, the sellers have come down to about where they are at negotiating levels...not theft! HA

Good point. The current market value might be off from last year, but in some markets people know that. A $375,000 house last year might be priced a lot less, but that doesn't mean the seller will drop it to $200,000 for example.

Hi JL -- Very sage advice for buyers, and we as REALTORS should be informing them of this more often so they are well represented. Each market/sub-market is unique and requires a keen insight into what is currently happening.

JL...you're always so wise. :)

People confuse 'deal' with 'discount'.

They are not always the same.

I was talking with one of my clients with two non-distressed properties about this the other day. She decided to take my advice and set the price on one of the properties just below the average sales price per square foot so that the house will now be perceived as a "deal." It's just ridiculous what sellers are having to do with perfect good houses to get them sold!

JL I spent my entire summer trying to explain this to buyers... I could preach it until I was blue in the face, but they only believed me when the property closed and I showed them that it actually closed $25K OVER the asking price. Just like I told them it would ;o)

I have so many clients that want me to find them a "deal", but when you ask them to define what that means, nobody can give me an answer. And when I show them a home that once sold for 1.2M and now it's 800K, and I say isn't that a deal, they look like deer in the headlight.

Can anyone explain what the word "deal" means?

NOV

From the desk of David Dee,

JL, right on mark. There are deals out there but very few steals. Customers need to be aware that they have to pay for what it's worth.

Thankfully our market here in Columbia is holding strong. There are plenty of great homes available at great prices. Congrats on the feature :)

Inventory in my market is a down a bit, and we're seeing more and more multiple offer situations. You hit the nail on the head here JL.

Jl, a big number of my recent bargain hunters looed at homes that needed work, not the pristine condition ones. Thye have made some great deals on cleaning, minor repairs and painting. Some TLC is worth a lot of reward in this market in my area.

I'm with Dave Humphrey on this one. I have buyers who want to put sweat equity into homes most buyers don't look twice at.

JL- Amen! Our market is not in the same condition as some and we are fairly stable considering. I have many buyers who want the "fire sale" prices that we are just not seeing here.

Exactly what I say. It is a 40 - 50% off sale so if it needs a little work, it is still a great deal! And here, if it is a REO you better go in with your highest and best right off the bat. Well said.

I had someone define a deal on a property that was an equity purchase as above all the other sales in the neighborhood. The paid less than ask by $5,000. Our market has turned here. We have more sales than listings.

Agreed. I find myself telling buyers more and more that 75c on the dollar isn't something that every seller is going to jump at.

You beat me to it! I was going to write a post about this. Too many people are looking for a "steal" not a "deal." There is a difference. As to foreclosures...does ANYONE seriously think they can by coy with a BANK and low ball like crazy??? They've been watching too many infomercials late at night if they do...

JL, Wise words and the wise buyers will listen and combine a realistic dream with the actual market.

Thanks JL-Buyers really do need to check the market they are looking in for true values. Not every market is the Miami Market style of buying. Here in Western North Carolina we have not taken the hit like other markets, and coming here will not get anyone a half price bargain, no matter how bad it is in other markets.

Glad to hear that Columbia is doing well too. It is a great city.

Absolutely! I wrote a post a while ago on "Whatever happened to win-win?" The worst offenders can be the ones that should know better. Had a "mortgage person" from out of state tell me how he knew that banks were just ready to dump properties and that's what he was looking for! Mind you, they are supposedly looking for a retirement home that they would actually live in for the rest of their lives.

I do love this blog. Absolutely amazing deals are gone within days. It's critical to be realistic. The old saying you get what you pay for is STILL true!

So true what you said... Everyone wants a deal. Even more, they come right and tell me they want to "steal something." Can you believe?

Then, based on price, you go look at the "deals." Some of them indeed are good deals but the excitment dies quickly because the EXPECTATION on the part of the buyer is of a pristine move-in ready dream home.

When you show them what they want, the deal/steal fades away often the buyer does too...

JL- Great article. Having dealt with similiar situations, who hasn't if you've worked at all in this market, I have helped some of my buyers to understand that sometimes the better "Bargain" was purchasing the higher priced home that included all of the amentities, appliances, fixtures, and had been cared for by a homeowner who maintained their property compared to the "Deal" down the street. Having worked in new construction I was able to price out for them what the actual cost of repairing the foreclosed home to bring it up to the same quality as the others we had looked at ended up HIGHER than what they would pay for the other homes they had liked. They were able to see for themselves where the REAL DEAL was!!

Don't shoot me for saying this but I have found that if the Agent doesn't know what the true market value of a home should be, it is doubtful their buyers will.

Bob said it right. The media has hyped everything to the point where expectations are not realistic.

We are seeing some incredible "deals" in our Atlanta market, but they usually have multiple offers. It is hard for buyers to get their head around the fact that they might have to pay more than list price while still getting a great deal. Many buyers learn the hard way by making low ball offers only to learn that someone else bought the property by offering more than full price.

It drives me a little nuts.....I constantly get phone calls about how much below asking price can we offer....10% 20%....I have to explain that prices are priced low to encourage a bidding war. The media is leading the buyer astray with unrealistic expectations and they are losing out on the good deals out there.

I have recently "dumped" two buyers that were being completely unrealistic. I have never listed a regular house - I have done nothing but REO and short sales - so I know I get great deals for my buyers.

One was a 3/2 in dated but very good condition - move in. But that extra $2,500 was a deal killer. Didn't matter that NOTHING had sold for less in 12 years and he was getting it at least 20% below current value.

The other wants to live close to the ocean and pay slum prices. The longer I do this, the pickier I am about who I will work with.

Then there are the manic hot heads who think all realtors are starving and should kiss their ring for the privilege of working with them. They call me at 7pm on Saturday and want to spend all day Sunday looking. If they have that little respect for me - they can find someone else. I tell them I am tied up for two weeks and then I am going to Hawaii for a month.

A good deal is in the eyes of the beholder. Because a market in one part of the country or city is stressed, does not mean that all listings are desperate

Yes I'm not sure why Buyers aren't seeing that the stress is already in the price....and really it's obvious when it isn't.

I try to impress on my clients that a good deal is not always the lowest priced home in a neighborhood. It's the home that has the greatest value for their situation. I hope the media stops specializing in real estate soon so people get these unrealistic ideas out of their heads. Thank you for the post and everyone's input.

BUT THE MEDIA TOLD ME I COULD GET AT LEAST 30% OFF THE ASKING PRICE VERY EASILY....WHAT GIVES HERE???? YOU GUYS HAVE ONLY REDUCED THE PRICE TO 2002 LEVELS...I STILL WANT TO GO 30% LOWER THAN THE LAST PRICE REDUCTION....I'M GONNA CALL THE LOCAL PAPER AND TV STATION AND TELL THEM THAT YOU REAL ESTATE PEOPLE AREN'T PLAYING FAIR !!!

LARRY MENNETTI FIVE STAR REAL ESTATE GRAND RAPIDS, MICHIGAN

I have talked to several unrealistic buyers recently. The market brings them out of the woodwork. I had one caller tell me that she wanted to look at only foreclosures because you can get them for 50% under list. I asked her what made her think that, and she said, "my sister is an agent in New York, and she told me that down here (Florida) that is how it works". HUH?

I think it's difficult for some buyers to make the distinction between a "great deal" and a "steal". There are plenty of great deals out there in the marketplace, but it's not likely that you'll be able to "steal" a property away from a seller, whether it's the bank or not.

I'm with you on that one.....they have multiple offers within a few days and they don't have to accept your low ball.

Inventory is getting low...multiple offers ....and they think that they get to low ball?

I work in two markets.

One is a Buyers Market. It exists all around me at $400,000 and up, maybe $350,000. It includes houses in excess of , say, 2000 square feet. It features 12 or more Months of Inventory. Out in the country: 2-4 years.

One is a Seller's Market. It includes anything under $300,000, especially under $200,000. It's the world under 1600 sq feet. It has 1-3 months of inventory in the city, 4-6 months in the country.

One of the things a client wants is for YOU to SHOW them they ARE getting a GOOD DEAL.

A good deal is a market price. Steals are rarely available. When compared to three years ago, everything is a steal. Compared to last month, not so much.

Clients want to know you know the market.

Many buyers know the market very well. They've been shopping. An agent needs to know more about "their" market than they do.

That takes work.

Deals are still abundant in this part of the country; in fact, our county has one of the hardest hit areas in the state for foreclosures. We try to get the short sales accomplished prior to a foreclosure, but sometimes that's tough given the personnel at the lending institutions.

I often run into the mentality where a buyer thinks he is the only one in the world with money to spend and sellers should be grateful for his lowball offer. In a few cases it may be true but it's the exception, not the rule.

In my area some towns were never hit by the bad economy, especially ones close to Boston. And we are starting to see a lot more multiple offer deals in play

Aloha,

Like Andrew Martin, I too have asked those seeking a "deal" to define what they have in mind. What may be defined as a "deal" on the island of Kauai is very different than other places. When I told a buyer that there was a great home that once sold for over a $1 million that's now asking $700,000 - it wasn't what he had in mind. He wanted that million dollar home for $250,000 (and he was being sincere).

Here on Kauai, I had a buyer who wanted a north shore condo with expansive panoramic ocean views for $300,000 or less. No matter how I explained that, that wasn't available, he still wanted it. There was one condo that met his budget and "claimed" ocean views, but it was barely a sliver of an ocean view. It wasn't until he finally saw it "up close & personal," that he realized the property he envisioned for the "deal" he wanted - just wasn't realistic.

Of course, there were condos for under $300,000, but his priority was ocean view. He has since purchased real estate on Kauai,within his budget, but it wasn't a panoramic ocean view condo.

Thanks JL for your post. Have a great day!

Debra

Hi Jl, I also noticed that the perception of what a good deal really is changes with the market. That " great deal " of a few years ago would now be considered way over priced.

Regretfully the media has "informed" Buyers that fifty cents on the dollar is the rule, not the exception.

The market prices properties based on "conventional wisdom" which takes into consideration everything that is available. The buyer will pay what the property is worth at the time and location/condition it's in.

The Buyer benefits if that price is less than it may have been at another time "snapshot". The Realtor must know what the market is, and why it is pricing the house this way at the snapshot moment.

The Buyer will only be happy with the correct price, not a fantasy price that the media may be passing off as true.

Good post!

Joe Pascal, 5 Star Real Estate, Wilmington, NC

Buyers need to be reminded that real estate is local and a "deal" can vary from neighborhood to neighborhood, and, even, street to street. The REO guys are setting auction pricing in our low end and this is creating a feeding frenzy like the mid 90's. 15 offers later, those buyers who were just trying to buy a home, found that the "deal" really was not ever available to them...the low asking price was set to just get buyers off the fence.

For sellers in this price range, it is now your market. Take advantage of it while interest rates are the best they have been in decades.

For buyers, your best "deal" is the current interest rate market which will change, sooner or later.

And for agents who are working with tire kickers, fire them and find a real buyer.

Well said...

Educating our buyers on the trends in the market can help make a buyer more realistic. Good thoughts...

I agree with this. Some buyers are not realizing the great DEAL may already be there right in front of them.

JL....good point. The "deals" invariably are in really bad condition. Buyers really need to concentrate on buying homes to raise their familys in...homes that are in good, safe neighborhoods, that are priced correctly for the market.

Excellent post and I have re-posted it. Buyers think that the banks are just going to roll over and give a way the house. We do not have enough homes on the market.

In my area, I've noticed a lot of first time home buyers do not want the typical starter homes their budget can afford. Nor do they want to put any work or money into their purchase, they want turn key properties. Instead of the affordable bungalows and ranch homes in the 1100 to 1300 sq ft range, their expectation is to be able to buy a late build 2300 sq ft home that is newer, bigger, and better than any home their parents ever owned, and they expect to get it at half price. They often will go through 2 and 3 Realtors before they realize that sellers do not have to give their properties away.

Amen, you tell em. Besides, do buyers think that this market will stay the same (desperate in their minds) forever? It's not realistic to think you are the only buyers for that foreclosure. Great post.

Yes, I agree. The media lumps all markets in one and some people are surprised that they may actually have competition on the house they want.

There are deals to be had, especially compared to several years ago. However, you have to be ready to move as there are a lot of buyers looking for those well priced deals.

A local agent who knows the market can direct you to a deal. Hopefully they can even help find you one.

And that's the bottom line! Same here in the Sacramento area. Thanks JL!

NOV

It sounds like many of us are in similar markets. Properties are moving and we are forever having to teach buyers that homes are not being given away. If you want it, you have to make a good offer and many tines compete for it!

Don't shoot me for saying this but I have found that if the Agent doesn't know what the true market value of a home should be, it is doubtful their buyers will.

I agree with Donna. Foreclosures often need a huge amount of work alot of which may be unknown until after you start renovating. When you add up the cost of repairs on top of the purchase price, you're often spending more than if the buyer purchased a house already in good shape. Too often, buyers perceive their 'good deal' based on their purchase price and not the total cost. Part of our job it to educate them on what the fair market value would be on the property "after repairs".

So many folks are doing the low ball thing. I have a couple of buyers that have done this and gotten burned. Unfortunately it take lots of work to get those people to see the truth of the market today. You can lead a horse to water but you can't make it drink.

Great post. It is so difficult for me to educate my buyers that homes in my area are selling within 92% of list price when they can go to the media or the internet and pull up all sorts of "data" about buying strategies. I had one client offer just over half of list price, got a counter $1,000 under list price, then wanted to offer less than their first offer because a "friend" told them this works. *sigh*

I guess all we can do is try, some clients will get something good and some will get what is left.

Seems like everyone is looking for their deal... or I guess in some cases we should say "steal".

Some of these buyers are living in La La land. We used to have problems with the sellers, now it is problems with the buyers. I just had a client want to offer $400k on a $678k short sale listing in a hot area. She says she doesn't care, it is what she wants and all she wants to pay!

Good advice JL. I had some clients this summer that wanted to low ball a perfect house that just came on the market. If anything, it was under priced. We had seen some real dogs and this house was truly the best. I relayed a sense of urgency and they made a slightly lower offer. Within hours of our offer being accepted, the Seller had 2 more offers. They still thank me.

NOV

Well put JL, especially the part where you state "they have multiple offers within a few days and they don't have to accept your low ball." My buyer clients think I've lost it when I tell them they probably have to offer full price to get a particular home. I frequently hear "I'm not paying full price for anything in this market." Sometimes it takes missing out on a couple of homes, which I don't like to see. I've resorted to saying "someone is going to offer full price and get this home. Do you want it to be you or someone else?"

NOV

Of course buyers want a bargain. Everyone wants a bargain!

I NEVER EVER "fire" a client. Our job is to REPRESENT customers whether they are sellers OR "only" buyers. I try to abide by the GOLDEN RULE. When someone tells me they have a fixed dollar amount they want to spend- I imagine that this person IS THE MOST IMPORTANT PERSON IN THE WORLD to me. Thats what they want me to be THEIR representative. I took an oath to honestly represent my clients--not myself. If customers ware content with buying high, that is their choice, BUT IF THEY ASK FOR DEAL, I look for those deals just like I would look for my own deals.

There is NO rule that says I must be an "order taker" or sales clerk. I am a salesman and an advocate for buyers, when I am hired to represent them. Does an attorney ONLY represent the "ggod guys"? NO! Realtors must represent BOTH SIDES EQUALLY.

When working as a buyers agent I focus on the FIVE D's"

Death, Disease, Disaster, Divorce, Destitution.

When these events occur, and the seller has EQUITY, my buyer is in a position of power to get the deal they want.

Too many of us--take the easy way out and only show "Active listings. If I know of a situation to help a buyers--AT ANY PRICE, I will go get the listing AND then sell the property in a VERY FAST CLOSE. This is legal and allows the buyers to "have their day" also instead of always chasing the market with ever higher prices. Look what happened to our market? Too many buyers casing too few houses produced a HUGE PRICE bubble that is hurting us today.

Of course buyers want a bargain. Everyone wants a bargain!

When working as a buyers agent I focus on the FIVE D's"

Death, Disease, Disaster, Divorce, Destitution.

When these events occur, and the seller has EQUITY, my buyer is in a position of power to get the deal they want.

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