How to determine what to offer on a house
Let’s say that you have already found the home that you want, most think that most of the work is done. But that is not exactly the case. Now, before you actually start submitting offers, you’ll first want to figure out how much you should offer. One of the most important parts to figure out during this process, is determining your offer price.
Here are some of the factors that can help you decide what to offer on a home.
Below are some of the most crucial questions you can ask yourself or your real estate agent to help you determine the best price for your offer.
1. What have the same type of houses sold for?
The research that you can do with recent sales in the same area is a great place to start when considering what to offer on a house. Comparables are a collection of recent or similar and nearby houses that are on sale. When generating comparables for the property you want to buy, think about having a checklist of things to check on similar to the one below:
- Bedroom & bathroom count
- Location & construction type
- Square footage of the house
- Condition (i.e. new construction, etc.)
2. How long has the house been on the market?
The amount of time a home has been on the market is a factor you should think about when determining your offer price for a house. Usually, the length of time a house has been on the market has a connection with how much you could or should offer.
The longer the house has been on the housing market, the lower your offer can be in most situations. Typically then, if a home has just been put on the market, your offer price should be higher. If you shoot low with an offer with a home that is fairly new to the market, the seller will most likely pass on and consider another opportunity since its new to the market.
3. What’s the condition of the houses?
A home that is ready for you to move into already, will usually receive higher offer amounts than a home that is in need of a lot of repairs. Although homes that need more repairs may save you money initially, you will still end up paying more for the repairs later.
When looking at the condition of a house, you’ll want to pay attention to structure or functional issues that the home may be experiencing. Meaning, you may want to look at the following below:
- A damaged roof
- Cracks in the foundation
- Rusty plumbing
- Mold or water stains on the walls
- Floors that are not even or warped
- pest or insect infestations
4. How flexible are you willing to be on price?
If your budget doesn’t allow you to offer more money, you can play around with the other aspects to ensure that your offer is still luring to the seller.
Aside from price, you can make your offer more enticing by showing more flexibility on things like:
- Closing schedule
- Closing costs