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My husband and I are starting to look for a house. We`ve been preapproved for an amount that we don`t want to spend- its just too high. I have heard different things about talking the owner down to a lower price. I understand that there are multiple bids for houses and we could end up paying listing price. But I`ve also heard that you should start the bidding at 10 percent lower than the homeowner is asking. My question is how close to the listing price did you pay?
I would recommend not telling anyone what you were approved for, no matter how many times they ask ... and they will ask. Just try to stick with telling them a ballpark figure you are looking to stay within, and keep it as something you will be comfortable with.
Trust me, I know how you feel .. these numbers are huge, and you wonder how you will ever afford it. This is the biggest purchase we ever make, and to do it the first time is a little startling when you hear the numbers.
Remember, just don`t tip your hat to how much you`ve been approved for .. it`s really not their business .. all they need to know is that you`ve been approved for the range you`re looking in.
However, there were 2 other bids above list but those bidders couldn't close as quickly as we could -- they had homes to sell and we didn't. The sellers had already had 2 deals fall through and had a closing scheduled on their new home 4 weeks after we saw it. So...in the end we bid less but won because the quick closing wasn't a problem.
I would never tell anyone the exact # you are preapproved for - you don't want to give anyone the opportunity to push you into spending what you don't want to.
The thing with the offers will depend on several factors including fair market value, what you are willing to spend, other offers, etc. In our case the house was definitely worth more - we just got lucky. In a sellers market, they do not often leave you time to 'up' your bid later. Many homes we looked at you had to give your best offer first as the homeowners would not negotiate. Depends on the market and the motivation of the seller. The numbers are huge, like Kel said, but don't worry - you will find your house in your price range!
We paid $20,000 under list. We offered $30k under, they counter offered, we accepted, and BAM!, we had a house. : )We really just lucked out because the sellers bought a condo, and needed to sell quickly.
Ditto to everything Kel and Lee said too! : )
And it was more than what we had originally wanted to spend. But houses in our range were in very poor shape.
This house was in great condition, and they were leaving us all appliances, light fixtures and window treatments...so we figured out we were coming out even.
We paid about 10k under list price. We were the first people to look at the house. The owners were building a house in Pennsylvania and didn't want to move for about 5 months. That was perfect for us because we closed on the house about 2 weeks before our wedding.
Thanks everyone. I didn`t realize what a difference there was. I guess we`ll have to just use our best judgement.
