Getting a Steal on a Deal - How Can I Do It?

Real Estate Agent with West USA Realty Revelation sa583776000

As a realtor in Chandler/ Phoenix,AZ I work with alot of buyers who are very conservative about the market, given what they perceive to be a bad economy. People are more money-conscious than they have ever been, and rightly so. Yet with prices in some areas down as much as 65% or more, buyers still want to offer below the asking price. What they are saying is "Every dollar is important so if we can save one then that is one more in our pocket, and that makes us feel better."

When going to write an offer I invariably get asked "How much can I get it for?" or "What do you think I should offer?", and secretly hoping that I'll say they should offer $20,000 less than asking when the home is listed for $100,000. Not much of a chance there, although I'll happily present all offers.

In the Phoenix market foreclosures account for about 44% of sales and 20% for short sales.

As far as foreclosures go, banks generally lower the price every 30 days if they do not accept a contract. Of course they can afford to do this, whereas an individual "normal" seller may not be able to, either because they need a certain net or that would put them into a short sale scenario. Homes for sale in the valley generally sell for about 96% of listed price. I rarely see banks negotiate more than 5% of their list price, although in one case when the home was listed for $160,000, the bank accepted $152,000 AND paid $4,000 of the buyer's closing costs, netting $148,000.

Short sales - price is set by homeowner/seller and listing agent, to be approved by the bank.Unfortunately it is fairly common for the agent to list the home exceptionally low to generate an offer, only to have the bank counter up months later, to the buyer's shagrin.

Normal sellers? Gosh, hard to quantify that one, as they all have their own individual motivation vs. short sales/foreclosures/REOs where the bank is an impersonal entity and it's all about the numbers. Make sure your buyer's agent asks the listing agent why the owner is selling at this time, how motivated are they, etc.

Of course there are many other factors besides price that give weight to your offer, including: closing date, earnest money, how much in closing costs you are asking the seller to pay, and contingencies.

You may be glad you did.

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About the Author

Matthew Coates is a residential real estate agent in the Phoenix, AZ (Chandler, AZ) area. He specializes in first-time homebuyers, investor purchases, foreclosures, and 2nd home purchases. Matthew is very active in the social media sphere. You can connect with him on Twitter, Facebook, LinkedIn, and YouTube

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Matthew Coates Phoenix Chandler AZ Real Estate

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