bid price / appraisal -- changing how you think of bidding?
Started by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
Discussion about
We officially restarted the search for a new apt recently. Been keeping up with listings et cetera in the interim. I'm noticing properties being relisted this year that were on the market last summer. As well as some price reductions. But they don't seem to be quite enough. Is anyone out there looking and when considering a bid, thinking about the issue with appraisals coming in lower, coupled... [more]
We officially restarted the search for a new apt recently. Been keeping up with listings et cetera in the interim. I'm noticing properties being relisted this year that were on the market last summer. As well as some price reductions. But they don't seem to be quite enough.
Is anyone out there looking and when considering a bid, thinking about the issue with appraisals coming in lower, coupled with the belief in many circles that NYC property values are still going to drop -- considering offering a dramatically lower bid from what the asking is?
For instance, I saw a lovely apt, in an uptown neighborhood -- large, good floor plan, nice kitchen. Close to trains. However it is a 4th floor walk up, and I think still overpriced given similar apartments I've looked at in the neighborhood - or even smaller apts that have more amenities (building garden/rooftop garden, basement storage, et cetera). At perhaps 30% less it might be more attractive to deal with 4th floor walk up. And then I wonder if I'm the only one out there considering this.
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
sorry should have added that other apts in neighborhood, regardless of size, had ELEVATORS.
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Response by The_President
almost 17 years ago
Posts: 2412
Member since: Jun 2009
most sellers are not going to accept an offer of 30% under ask. If you think that prices are going to fall by X%, then wait for them to fall by that much and then bid.
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Response by Riversider
almost 17 years ago
Posts: 13573
Member since: Apr 2009
Three words: Mortgage contingency clause
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
I think mortgage contingency clause goes without saying.
The President -- they may not accept 30% under, but if others also happen to put in offers below asking, then it would seem to me that sellers would have 2 choices: a) accept least painful lower bid, b) play a waiting game and hold out as long as they think they can
All they can do is say no to any bid, they don't have to accept it.
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Response by gcondo
almost 17 years ago
Posts: 1111
Member since: Feb 2009
buyers are trying to exploit their market as much as sellers used to!
If you find an apartment you really like, you better not throw a 30% lowball bid, because more than likely, unless the seller is totally desperate, you will be ignored. Sure, you might get lucky, but you probably wont.
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Response by The_President
almost 17 years ago
Posts: 2412
Member since: Jun 2009
well, if you have nothing to do than to make bids that will be DOA all day long, then be my guest. But most people have a life.
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
gcondo - exactly. If you aren't completely attached/desperate for an apt, it cannot hurt you to make a low bid, figuring on what the appraisal value would be in this market. The buyers turn it down? Oh well, you can counter, or move on. Am I nuts? I might be. And for the record I used 30% discount as an example not a hard and fast rule that everyone should be out there bidding 30% off any apartment in the city ;-)
The_President -- I swear I have a life, I also think there is still some fluff in the pricing out there!
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Response by ab_11218
almost 17 years ago
Posts: 2017
Member since: May 2009
If I would get a 30% below ask offer and consider it, I would relist it for at least 2 weeks at 20% below and see what happens. At 20% below, I would expect, there will be a lot of action...
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
sounds like as good of a strategy as any other, ab-11218. i went to some open houses this weekend, that i think were doing exactly what you suggested. i noticed that there was almost no traffic at them however.
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Response by scoots
almost 17 years ago
Posts: 327
Member since: Jan 2009
There is no downside to try.
Good luck!
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Response by clm4040
almost 17 years ago
Posts: 3
Member since: Jun 2009
The bottom line is that anyone who's trying to sell their apartment in this environment is hard up to sell otherwise they'd wait for the market to turn around or rent in the case of condos. If you are not in a rush to purchase, I'd suggest putting a 25-30% below ask bid in and wait. If the apartment stays on the market through August my bet is that seller will be calling you to hit the bid. Come this fall the market's only going to get worse. My 2 cents.
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Response by The_President
almost 17 years ago
Posts: 2412
Member since: Jun 2009
"The bottom line is that anyone who's trying to sell their apartment in this environment is hard up to sell"
That is complete nonsense.
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Response by HDLC
almost 17 years ago
Posts: 177
Member since: Jan 2009
Take a look at the most recent contract and closing prices for comparables. If your bid is in line with what comparable property is trading for today, then it's a fair offer. If the owner insists on a price that is out of line with the changing market realities, then take a walk. The buyer is the one with control because s/he has the money and there is plenty of inventory.
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Response by allchitchat
almost 17 years ago
Posts: 1
Member since: Jun 2009
Does it really mean anything when your appraisal done last week came in higher than the price you bought the property for 3 years ago?
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
HDLC -- would the most recent closed sale prices make the most sense? I would think their usefulness depends on when they went into contract. I think many things that have just closed went into contract before the NYC market really started to slide.
?
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Response by HDLC
almost 17 years ago
Posts: 177
Member since: Jan 2009
tandare, Good point you make. I was just thinking of those properties I've tracked on my SE "Saved Properties" list. There were a couple that went into contract within the past 2 months. The SE e-mail notification for additions to 'Saved Searches' can also be pretty helpful to keep track of how comparables are moving.
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
hdlc, thanks for the reminder. i need to update my saved buildings list.
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Response by tandare
almost 17 years ago
Posts: 459
Member since: Jun 2008
by the same token, seeing what a same line apartment (e.g., B-line) in a building that sold during the peak of the market isn't useful either but I see people using that as good information. To each his own I guess?
sorry should have added that other apts in neighborhood, regardless of size, had ELEVATORS.
most sellers are not going to accept an offer of 30% under ask. If you think that prices are going to fall by X%, then wait for them to fall by that much and then bid.
Three words: Mortgage contingency clause
I think mortgage contingency clause goes without saying.
The President -- they may not accept 30% under, but if others also happen to put in offers below asking, then it would seem to me that sellers would have 2 choices: a) accept least painful lower bid, b) play a waiting game and hold out as long as they think they can
All they can do is say no to any bid, they don't have to accept it.
buyers are trying to exploit their market as much as sellers used to!
If you find an apartment you really like, you better not throw a 30% lowball bid, because more than likely, unless the seller is totally desperate, you will be ignored. Sure, you might get lucky, but you probably wont.
well, if you have nothing to do than to make bids that will be DOA all day long, then be my guest. But most people have a life.
gcondo - exactly. If you aren't completely attached/desperate for an apt, it cannot hurt you to make a low bid, figuring on what the appraisal value would be in this market. The buyers turn it down? Oh well, you can counter, or move on. Am I nuts? I might be. And for the record I used 30% discount as an example not a hard and fast rule that everyone should be out there bidding 30% off any apartment in the city ;-)
The_President -- I swear I have a life, I also think there is still some fluff in the pricing out there!
If I would get a 30% below ask offer and consider it, I would relist it for at least 2 weeks at 20% below and see what happens. At 20% below, I would expect, there will be a lot of action...
sounds like as good of a strategy as any other, ab-11218. i went to some open houses this weekend, that i think were doing exactly what you suggested. i noticed that there was almost no traffic at them however.
There is no downside to try.
Good luck!
The bottom line is that anyone who's trying to sell their apartment in this environment is hard up to sell otherwise they'd wait for the market to turn around or rent in the case of condos. If you are not in a rush to purchase, I'd suggest putting a 25-30% below ask bid in and wait. If the apartment stays on the market through August my bet is that seller will be calling you to hit the bid. Come this fall the market's only going to get worse. My 2 cents.
"The bottom line is that anyone who's trying to sell their apartment in this environment is hard up to sell"
That is complete nonsense.
Take a look at the most recent contract and closing prices for comparables. If your bid is in line with what comparable property is trading for today, then it's a fair offer. If the owner insists on a price that is out of line with the changing market realities, then take a walk. The buyer is the one with control because s/he has the money and there is plenty of inventory.
Does it really mean anything when your appraisal done last week came in higher than the price you bought the property for 3 years ago?
HDLC -- would the most recent closed sale prices make the most sense? I would think their usefulness depends on when they went into contract. I think many things that have just closed went into contract before the NYC market really started to slide.
?
tandare, Good point you make. I was just thinking of those properties I've tracked on my SE "Saved Properties" list. There were a couple that went into contract within the past 2 months. The SE e-mail notification for additions to 'Saved Searches' can also be pretty helpful to keep track of how comparables are moving.
hdlc, thanks for the reminder. i need to update my saved buildings list.
by the same token, seeing what a same line apartment (e.g., B-line) in a building that sold during the peak of the market isn't useful either but I see people using that as good information. To each his own I guess?