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Foreclosures: The Low Ball Offer

By
Real Estate Agent with The Bean Group

New Hampshire Real Estate:  Part of the job as a Realtor is educating ourselves to the market so we can best serve our buyer and seller clients.  The only way to truly understand our markets is to do the research.  There is no doubt foreclosures are driving our markets today.  Ten of my last twelve transactions have been foreclosed homes.

Foreclosure Benefits:  Generally speaking, a foreclosure purchase can be a rewarding experience.  For a buyer to be able to purchase a home at a substantial discount is one way to walk into instant equity.  Some properties and not just foreclosures are in physical distress or less than perfect.  FHA 203K rehab loans are available where buyers can get money added to the discounted purchase price for repairs and/or updates and still make only a 3.5% deposit.

 Sold Foreclosures:   64 foreclosures have been sold in New Hampshire Real Estate since April of 2010.  The average sales price was $172,860.  The lowest was $19,500 and the highest was $325,000.  The asking price to selling price ratio was 94%.  That means foreclosures were selling on average at 94% of the asking price.  Other sales in the state are averaging 96%.  There isn't much difference here.

The Low Ball Offer:   If these homes are selling at 94% of asking price, one could conclude the Low Ball Offer isn't working in New Hampshire Real Estate.  The banks are just like any other private seller.  They want to maximize the price they get for the homes they own.  The banks are just a little more reasonable about adjusting the price to meet market value.  Market value is the price at which the home sells and that is a subject for another article.

About The Author:  Marty Patrizi is a Realtor with Virtual Homes, Inc.  Marty has been buying, selling, building, and renovating properties since 1988 and he can help you acheive your New Hampshire Real Estate objectives.  Marty can be reached at 603-781-4099 or by email marty.patrizi@virtualhomes.com.  For FREE ACCESS to search all homes for sale in the NH MLS, visit TheNHRealtor

                                       

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Carol Zingone
Berkshire Hathaway Home Services Florida Network Realty - Jacksonville Beach, FL
Global Realtor in Jax Beach, FL - ABR, CRS, CIPS

Marty, great post, and something I have to educate buyers about constantly here in Jacksonville Beach, FL - they all think they can get it for 50 cents on the dollar, and that is just not the reality.

Apr 15, 2011 02:05 AM
Marty Patrizi
The Bean Group - Strafford, NH
Multiply Your Propertunities

Carol,  Thanks for the thumbs up.  What is the list to sell ratio in your area?

Apr 15, 2011 02:23 AM
James Loftis
RealEstate911.com - West Palm Beach, FL
RealEstate911.com

I always advise my buyers to make an offer based on the values of the property and not on the list price.

A lot of Reo's get into multiple offer situations and it can be a great waste of time to submit low ball offers.

Apr 15, 2011 02:45 AM
Marty Patrizi
The Bean Group - Strafford, NH
Multiply Your Propertunities

Thanks Jim,  buyers need to understand they have competition.

Apr 15, 2011 03:08 AM