Is 30% under the asking price a ridiculous amount?

[sandmanmrm]

I am looking at a triplex that needs a lot of work, sheetrock flooring, appliances and cabinets throughout. It has been completely gutted down to the framing then completely rewired so that is start. Foundation, roof, windows, doors and siding are all in very good shape. It is listed just over the tax assessed value and I would like to make an offer for 30% lower than the asking price and I have all cash in hand for the purchase. Does this seem reasonable?

[kensmith]

It depends on your market. I never think a cash offer is ridiculous, they might be facing forclousure and something is better then nothing. You never know unless you try, just be ready for the offer to be rejected as that is the most likely thing to happen.

[sdhomes]

Assessed values are meaningless as a basis for price.

[AaronSOLD]

I agree with Ken and Bob and would add this - What do you think it is worth based on recent comps?

Step in the seller's shoes. Unless really desperate, they aren't going to let the house sell for 30% less than it is worth. However, if it really is worth 20%-25% less than it is listed, then 30% off listing price isn't crazy.

[JennH]

..but if the house is worth close to what it is listed, you may end up insulting the owner and getting no reply. Or you could get what a friend of mine did when selling her place not long ago, a counter offer for a price higher than the list!

[thatguyTR3Y]

I don't think that's unrealistic at all. Try this some time find 10 properties you think could be decent deals for you or try 5 if you think 10 is too much. Make sure you have buyers or investors ready to go on these properties. Write purchase agreements for each one of these properties at 50% of the list price. you'll be surprised when you get an accepted offer and you've got yourself a juicy deal. GOOD LUCK

[Homesurfer]

In the ideal world you're looking to hook up an informed "ready, willing, and able" seller with an informed "ready, willing and able" buyer. Every once in a while there are going to be exceptions, but those are exceptions - not the rule. If you routinely offered thirty percent under what YOU think is fair market value - that would get ridiculous and eventually no one would want to write up your offers.

Also - as soon as someone talks about the property's "assessed" value - they lose a lot of credibility. Like Bob said, assessed value means nothing except that it determines what the property owner pays in property taxes.

Lack of nicotine. That's my excuse.

[Bob Crain]

Sand Man,

In our state, CA a Sellers agent doesn't even have to submit an offer if it is ridiculously low. Is 30% below the asking price riciculously low? I show my sellers everything and let them decide.

I had one Jacka$$ seller think that the bottom end of the price range was ridiculously low after we got an offer at that price. A year after we fired HIM, he went through two other agents and listed it for $100,000 LESS then what we had put in front of him, and he still hasn't sold his home... Maybe, just maybe he doesn't think it was ridiculous???

[sdhomes]

Actually in California all offers must be presented to the seller, even during escrow, unless you have a written agreement with the seller to the contrary.

[Bob Crain]

While it is true offers must be submitted until escrow is closed there are a few exceptions to this rule.

1. If the seller says no more offers. I ask for this in writting.

2. If the offer is "Patenly Frivolous". NOTE: the state of California DOES NOT define "Patenly Frivolous". Which is why most agents are taught to submit all offers to their clients until they tell them no more offers.