Quote from @Bill B.:
My last purchase I made an offer for $305k on a $315k property. It appraised for $285k and that’s what I paid. Nobody expects you to be sitting on $20k, even if you are.
Take a survey of 2.0 homes buyers and ask how many have an extra $10k sitting around, I bet it’s around 10- 20%. Americans tend to buy what they can afford. They tell their realtor how much they have for a downpayment. The realtor works backwards to the most they can pay, and that’s the houses they look at. Because they will be the nicest they can buy. That’s why they ask for closing costs, they don’t have any cash.
I’m not saying you have ti lower the price if you have more buyers, only if you want to sell to these buyers. If it’s priced right you should have 5-10 offers within a week. If you’re not getting other offers while you contemplate this one, are you going to lower the price $10-$20k in a couple weeks or turn it in to a rental?
I was going to say tell them you need a week to see if any other offers come in. But then if they don’t the buyers may get cold feet thinking they are overpaying. After all, you can’t even lower the asking price $5k or you’re going to end up losing money when the next buyer’s inspection report finds a problem. GL either way.
Good morning Bill and thank you for the reply:
The avg. asking price around the neighborhood is well above what I asked for. The avg. for 3/2/2 1700 sq ft. with 10k-15k sq ft lot was asking as high as 385k down to 360k - After a ton of upgrades I did the past 2 years because we thought we would be keeping the place and living there from time to time.......New Roof 2019, New AC unit, line set and break out box with a special filtration system and a UV Bulb in 2020, new gutters during the new roof. Custom French drain system gravity feed by the gutters and diverts to drain out at the front covert of the property. new driveway with new covert drain pipe (should have been done by the city but thats another story) New AO smith energy efficient hot water heater, complete new plumbing through out the house, new shut off valves in all bathrooms, New specially designed toilets (Love these toilets!! LOL) and pessary shut off valves and new plumbing - kitchen etc. new fixtures with the new sinks, new soft close cabinets in kitchen and large stainless chief style sink with custom granite counter tops. The same slab was used to provide the granite counter tops for the new vanities in the bathrooms with the same style matching soft close cabinets so it all flows and matches. All done fall 2021. New stainless kitchen appliances. Then we move to the electrical. COMPLETE NEW electrical Square D box, new 220v lines for the new over head microwave, oven and dishwasher. New circuit for the garage door opener, new LED lighting and circuits for the garage, Flush mounted LED lights (disable) for the the kitchen, New led lights for walkways, hallways, bathrooms etc. New Flush mounted LED lights on its own separate circuit for outside lighting on a day and night timer that is motion detection ( so when you pull up in the driveway the place lights up the night sky) Probably close to 10k in electrical. All outlets inside and outside replaced! all switches inside and outside replaced.....new door led (fancy) light fixtures. All done summer/fall 2021 - Lets see what else....Oh yes outside painting Spring of 2021, updated landscaping just last month. The only thing I didn't do was new floors and they need to be done - and interior painting (some was done)
Oh and had new circuit installed to float mount the new TV for my mother in the family room, pressure washed/cleaned the porch and painted it.......I know I'm missing something but all in all - we did a lot of the important stuff. New Roof, New AC, New Drive way and covert, New French drain system all around the entire house, new exterior paint, New extensive electrical....(which the inspector for the buyers said he was super impressed with the electrical) never seen such a clean and detailed install. The electrical contractor is a friend of mine and it still cost me close to 10k for all the work! it was a lot of work done.....took over a month -
So my asking price was 359,900 and they came in at 360k - I accepted and the next day they had an inspector on the spot as if it was pre planned - then the "rush" appraisal 2 days after - that comes back at 350k - My thoughts are if you agree on a price you stick with it......Of course I wanted more. I know the median rent is awesome IF we rent and so is the STR for the area...( I already had it researched)..I can set it up to stream line it for STR / Air BnB and would probably make a killing - daily rentals for this house in that area are a low of 200 a night up to 400 or even 500 (but we do not have a pool - I can get one installed down the road if I keep it and want to continue Air BnB.
If his bank said 350k his down payment will be slightly less - he will have the extra money but something just isn't right in my gut so im starting to lean towards keeping the property - get the floors done for 8k - finish the inside painting, maybe get rid of the popcorn and up grade the door handles inside and hinges to give it that extra good look - then rent it STR air BnB or long term at 2500 to 2900 a month (which isn't bad at all) - and use it as leverage for a rental property for a duplex near me and house hack it renting out the one door and put my mother in the other one. Start to build my rental portfolio from there. I just want to get out CC Debt quickly and selling the house will definitely do that around 70k cc debt. not including my new truck at 54k which is currently a 0%/72 month loan (basically a free loan) and my wife's at 4.7% principal - 36k - thats my main concern right now - I know Dave Ramsey would be having a fit at me LOL -
