Embarassing offer

[Jennifer Lee]

hi BP

i have had the opportunity to be shown a home before it was listed.
it's in my farm neighborhood so great location, school, afforability, shopping, transit.

I have was given info that the seller maybe motivate (kids of owner)

the owner is original own since the 60's. so everything is original, but very well maintained.

there maybe an issue of the owner encroaching on public lot (his driveway, the lot next door was supposed to be a road that was never built) I am working with a lawyer if the need arise.

renov is comestic, upgrade, it's a 60's house in all the decor sense. i already have a realistic budget.

based on a similar purchase on the same street by me last wk, my offer will be really embarassing.

should i wait, let it list, sit in market...and approach later?
or just do it? run the risk of reject bc it would be their very first offer...

it doesn't make financial sense to me if I offer anymore to flip.

thanks for you advise.

this would be mls listing, not foreclosure etc.

AT this point i dont' even know listing price...broker still working on it

[J Scott]

First, once the listing agent is involved, things get much more difficult. The listing agent will push to list it before accepting a 70% offer, even if the offer is fair.

That said, we put one under contract yesterday -- seller was the neighbor of our most recent rehab. House hasn't been updated since the 70s and seller wants to move.

This is how we approached the low offer:

"If you want to get the most for your house, we recommend about $20K in cosmetic updates and then you should be able to get a good bit more than what we can offer. Specifically, we'd recommend [we listed the stuff she would have to do]. In fact, that's exactly what we'll probably do if we buy it from you -- put in about $20-30K in those cosmetic upgrades and then resell it. But, if you just want to be done with it, get on with your move and get your cash without having to do any repairs, we think that what we're offering is fair. We can close next week. Btw, if you decide to go the repair and listing route, we have a great crew of contractors we can recommend who could do the work at a very affordable price."

The key is, we were honest that she could get more for the property (which I'm sure she already knew, but it verified we were also looking out for her), and made her think about the details of the work that she'd have to do if she was going to rehab it herself before she listed it. Not only did we not put any pressure on her, we told her flat out the better financial decision was to do it herself.

The next day, she called and countered a bit higher than our offer. We accepted and are closing next week. I guess after thinking about the work she'd have to do, she decided the extra money wasn't worth the effort.