Author Topic: Trying not to be greedy  (Read 680 times)

nsmall

  • Stubble
  • **
  • Posts: 118
Trying not to be greedy
« on: June 20, 2020, 11:34:16 PM »
I have a rental I am in escrow with.  Listing price 310, buyers offered 325 no closing costs.  Appraisal is going to come in low this week as there are no homes selling for 325 at this size.   I live in a city of 160k and there are only a few homes for sale in the price range of 250-330k.

1) Is it typical to ask for more money from the buyer on a low appraisal?
2) lets say the appraisal is 315 is it fair to ask for 320?


I know my agent can answer these questions, just curious if others have an opinion.  Thanks in advance.
 

economista

  • Pencil Stache
  • ****
  • Posts: 788
  • Age: 31
  • Location: Colorado
Re: Trying not to be greedy
« Reply #1 on: June 21, 2020, 11:20:03 AM »
I think it is usually written into their offer if they will give more than the appraisal. We last bought during a really hot market and we had to offer $X, going up to $10k over the appraised value, because every offer submitted has a clause saying they would go $Y over the appraised value.

economista

  • Pencil Stache
  • ****
  • Posts: 788
  • Age: 31
  • Location: Colorado
Re: Trying not to be greedy
« Reply #2 on: June 21, 2020, 11:24:18 AM »
I hit send too soon :D

Also, it depends on how the buyers are financing the purchase. A bank will not give a mortgage for over the appraised value, so they will need to have cash on hand to give you,  outside of their closing costs, if they agree to pay more than the appraised value.

rothwem

  • Pencil Stache
  • ****
  • Posts: 739
  • Location: WNC
Re: Trying not to be greedy
« Reply #3 on: June 22, 2020, 09:42:14 AM »
If I were the buyer, Iíd have a hard time spending more than the appraised value, since that extra money basically evaporates after the closing.  Itís doubly important on a rental property where your literally buying something to make more money.  Iíve walked on one deal that didnít appraise and on a second one, the seller met me at $1k over the appraised value because I threatened to walk.  Iím kinda pissed that I lit $1000 on fire in that scenario, but it got emotional on the sellers end and it was the best way to give him a ďwinĒ so that I could still get the property.

You need to be in a super super hot market with lots of dumb money to expect people to pay over the appraisal.

Phoenix_Fire

  • 5 O'Clock Shadow
  • *
  • Posts: 66
  • Age: 43
  • Location: Phoenix
Re: Trying not to be greedy
« Reply #4 on: June 23, 2020, 11:36:15 AM »
I agree about it needing to be a hot market to get them to go over appraisal. My wife and I just put an offer in on a house, offered $10k above asking, and offered to cover up to $20k out of pocket if the appraisal came in short. We got outbid. Supposedly someone offered $25k over asking, and would cover any amount over appraisal.

I guess Phoenix qualifies as a super super hot market right now. Less thank 10k houses on the market. It's crazy.

nsmall

  • Stubble
  • **
  • Posts: 118
Re: Trying not to be greedy
« Reply #5 on: June 24, 2020, 11:16:38 PM »
Original poster here.  Home appraised for 307, buyer offered 3k out of pocket.   Home was listed for 310, they initially offered 325.  So we are taking the 310 even though it does stink some as we had another offer of 318 but there is no way this home will appraise for more than 310 anytime soon.  Thanks for all your advice.

Neil