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    Home Unlabelled Real Estate: Jedi Tips to get a home below asking.

    Real Estate: Jedi Tips to get a home below asking.

    January 01, 2021

    Real Estate: Jedi Tips to get a home below asking.

    Jedi Tips to get a home below asking.

    Posted: 01 Jan 2021 06:45 AM PST

    Hello everyone,

    I posted here before (with lots of downvotes, presumably from agents and investors) but for the lurking homebuyers, here are some tips to consistently get a home below asking. Market dependent of course. My story: I am currently under contract for a 2200 sq ft. SF home located in SE Michigan that was originally listed for $280k. It is under contract for $215k with $5k back at closing.(the dream for buyers right?) Homes in this neighborhood routinely run for over $300k during the right time of year. It is a complete 2020 remodel as well but the owner got snakebitten by the CoVid madness. If you check my post history, I've successfully gotten sellers to take off anywhere from $15k-$70k during my home buying journey during the last few months. I hope my advice works for you wherever you are.

    1. Check the property taxes on the home you are looking at before offering. It will not only tell you if the property owes back taxes (signs of a motivated seller) but also who or what owns the property.

    2. If the property is owned by a corporate entity like an LLC, that is a a good sign. That means the owner is more than likely dispassionate about the property versus someone who has been living there for 3+ years making memories. Especially if the corporate entity has owned the property for less than two years with major remodel work. Leading to my next point.

    3. If the property is owned by an LLC, odds are significant debt will be attached to the property as well. Investors do not have access to the low interest rates that owner-occupiers do, so use that knowledge to your advantage. If a corporate entity has a significant loan balance on a property, it is typically a hard money loan where interest rates are routinely 3-5% higher than a conventional loans, maybe even higher if the corporate entity is owned by an amateur. They want to move that property FAST.

    4. Armed with the foregoing knowledge, you can now ballpark calculate how much money they are burning on a monthly basis to gauge what I call the "seller-investor desperation spectrum." If there is a large hard money loan balance, back taxes, and the property is VACANT, you can be rest assured this investor is losing money hand over fist every month.

    5. Be patient. Everyone loves a shiny new toy. The house thats been on the market for 30+ days looks like stale moldy bread in comparison. Let the owners sweat a while before putting in the offer. To me, there is no such thing as a home "I have to have now." or dream home. Every home has potential, just understand how value works and operate from there.

    6. Just because a home has been on the market 30+ days, does not mean the house is undesirable. The home I am under contract for went under pending sale multiple times at much higher list prices before I finally put in an offer. All of those deals fell through (could be inspection, could be buyer financing, could be cold feet, you never know but thats why you do your own due diligence). Now I am the lucky buyer who is potentially sitting on a ton of equity just because I waited an extra month before swooping in. Which leads to the next point.

    7. Waiting is a virtue because it gives you time to study the market but also avoids the aggressive/impulsive early buyers that think just because they have access to cheap debt, they can throw money at the newest toy on the market. Like I said, the home I am buying has had multiple offers above $250k. If I were to have offered at that time, I would probably have gotten myself entangled in dumb bidding wars paying much more for a home than I need to.

    8. Do not give AF about losing out on a house because you waited and watched. Especially if the home you want has not left the contingency period yet. Deals fall apart all of the time. If the deal falls through on that home you had your eye on, it now looks like damaged goods regardless of whether it was the seller's or buyer's fault for failure to close.

    9. I repeat, do not give AF! When I finally offered on my future home, I initially offered at $190k to get a sense of the seller's thinking. If they come down on the list price at all, then you know there is blood in the water. If they don't budge, then they are either irrational or just simply bad at business and you don't want to deal with them anyway. If they could've sold at list, trust me they would have after a month. Time is your friend as a buyer, feel free to waste it.

    10. When the seller countered at a lower price than listing but didnt meet me at my low ball offer, I made what's in my mind my "walk" offer. For example, my walk offer was $215k plus concessions. The seller wanted $230k. I walked. One week later, my broker called me and said they came back with their tails between their legs. I also recieved more in concessions than I intially expected. I repeat, do not give AF. Offering more than twice shows weakness and naiviety. Walking after the 2nd offer shows you know what you are doing, whether you actually do or not. Never be afraid to take a slow hike. The tortoise did beat the hare afterall.

    11. Offering on homes owned by the occupiers is more of a mix bag due to emotional attachments and memories. This method may work (for example, if the seller needs to sell the house before buying another one) otherwise, I'd recommend leaving an owner-occupier home alone if you want a good deal. One owner-occupier was listing a home I was looking at $20k above similar homes in the area with no upgrades in decades and less sq. footage. When I went to the open house, I even asked the realtor why I should offer on this home when I could buy a bigger remodel down the street for $20k less. Coincidentally, the list price on that home went down $10k a week later. It is now under contract for more than what I offered on my current bigger remodel in a better location. Go figure.

    12. Finally, there are plenty of fish in the sea. Inventory may be low now, but homeowners aren't dumb. Eventually everyone will see the overpriced homes selling like hotcakes and think they can join in on the party. Buyers are limited beings, only so many to go around. Act accordingly. As a buyer, you are a precious resource to everyone involved in the real estate process, from the lender, to your broker, and most importantly the seller. Act like one. Don't take yourself for granted because you don't have a home yet. You're a f'ing unicorn.

    TL;DR. Homebuyers are unicorns. Act like one. You'll be on your way to a better homebuying experience in no time.

    submitted by /u/durtymrclean
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    How much of the air/space above my land or home do I own or have rights to? (CA)

    Posted: 01 Jan 2021 01:05 AM PST

    Hawaii Market- What’s the current state?

    Posted: 01 Jan 2021 08:43 AM PST

    Any agents/realtors from Hawaii on here?

    Was the Hawaii market hit hard by the pandemic?

    What's the general state of the real estate market there?

    submitted by /u/colty31
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    Cold calling owner re: house not on market - purchase for personal use

    Posted: 01 Jan 2021 06:56 AM PST

    We are preparing to buy a home for personal use in a really tight seller's market. Homes here generally go under contract after a few days and for over list. We have learned through word of mouth of two houses in our target neighborhood that may be potential buying opportunities. One is unoccupied and the owner of the other one recently passed. I've never cold called before. How do you do it? Call? Write a letter? Any tips? Is this advisable? Has anyone had similar success stories? TIA

    submitted by /u/awwfawkit
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    I need advice because I won't be present during the sale of my apartment in a foreign country

    Posted: 01 Jan 2021 06:26 AM PST

    I'm selling a property abroad and due to covid I will not be able to attend the sale / transfer of deeds. Should I trust the estate agent with power of attorney? And what's the best way to post the deeds?

    submitted by /u/mitchbuzz
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    Next door construction issues

    Posted: 01 Jan 2021 09:44 AM PST

    I have had construction next door since February. I'm going to make this short and simple. The builder has not put anything around the house to prevent soil and sediment runoff and it is pooling around my driveway and mailbox. I've been putting up with this for almost a year now. I have asked for a meeting with our HOA president. What can I do to keep this runoff from coming down - like a barrier or something to put down? Since I would be putting it on my property I would assume that it would be OK since I have to look at a port a potty through my front windows. Any and all suggestions welcome.

    submitted by /u/worthyofgrace
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    How to buy the house I'm currently renting

    Posted: 01 Jan 2021 07:51 AM PST

    I have been living in a house in the greater DC Metro area. It is an old house with few updates since it was built in the 60's. However, i like it and plan to stay at least a few years: great elementary school a few blocks away and close to public transit to go to the office (if that ever happens again!).

    My landlord is a great guy and takes good care of the place. He lived at this house before marrying and moving in with his wife. He told me about a month ago that he and his wife are considering getting a divorce. Obviously, I was worried they would sell and my family would need to find a new place to live. Apparently, he is keeping the house.

    My question for the good people of this sub: how should I approach my landlord to buy this house? I don't want to come off like an asshole to him, I would want to make a deal appealing to him, but I do think I have some leverage on price. This house has appreciated considerably since he bought it over 20 years ago, but badly needs updates if he were to sell.

    My Plan: 1) Buy house for $300k (undermarket). 2) fix most outdoor problems, driveway, and flooring myself and hire a contractor for bathrooms and kitchen cabinets. 3) live here for three years and sell for $450k (current reasonable comp for up-to-date houses). I then plan to move to a cheaper area and probably change careers.

    I think the landlord would be interested in selling for the following reasons: 1) Divorces are expensive; 2) he could fix and sell himself, but it would involve not collecting rent, paying contractors at once and up-front, and paying a realtor--my idea eliminates all of these. 3) We could structure a deal that works out for him tax/alimony(?) wise.

    Here are a few plans that I've been kicking around:

    --Just buying it - Self explanatory. I approach him about buying it undermarket with no fancy maneuvering.

    --Rent-to-own - Pros for me: lower down payment. Pros for him: splits up some of the earnings over multiple years to stay in lower tax brackets and earnings calculations for alimony and child support. Cons for me: I don't own the house for several years and legally things can go wrong with RTO. Cons for him: fixed sales agreement when house could appreciate and rental income is taxed as regular income.

    --Owner financing - Pros for me: I hold the deed. Pros for him: splits up some of the earnings over multiple years to stay in lower tax brackets and earnings calculations for alimony and child support. Cons for me: possibly higher interest rate. Cons for him: risk of default (my wife and I have good, fairly stable jobs, however)

    Any help is appreciated before I actually bring this up!

    submitted by /u/LEcon46
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    Changing Brokers

    Posted: 01 Jan 2021 07:38 AM PST

    Is it unprofessional to change brokers a few times? I just joined a team at a new broker & quickly learning that it's not a fit. I was also just offered a much better opportunity on another team but it's at a different company.

    submitted by /u/lwrealtor
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    Real Estate Investing Groups?

    Posted: 01 Jan 2021 07:32 AM PST

    This may be a weird question... but is there such a thing as a real estate investment group? I know they exist, but I am wondering if they exist in the way I am looking for. So, here is what I'm looking for:

    -Imagine there is a house for $300,000 dollars.

    -Instead of a single person putting up that 20% down-payment ($60,000) , the group puts it up together.

    -So for example, let's say the group is comprised of 4 people, so each person just puts up $15,000.

    -The group then gets a property manager and gets a tenant into the property.

    -The group then splits income they get from tenants.

    Are there such groups out there like that? Would that be too messy? I'm new to real estate, so I'm just wondering if that's feasible or even recommended.

    submitted by /u/thatanimeguy1
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    Are we obligated to disclose all "old" inspection reports while selling property?

    Posted: 01 Jan 2021 07:29 AM PST

    We are looking to purchase an old property (Canada, 1950 build). It had UFFI insulation which was removed it 1980s, and has certificate, photos for that.

    We did inspection on property which revealed air having high level of formaldehydes. The current owner said it could be due to candles she burnt there hours before testing. So, she did her own specialized air quality test of the house, which revealed air being clean.

    Question is: If I buy this house and sell it 5 or 10 years down the line, would I be obligated to reveal all these different inspection reports.

    submitted by /u/DollarMouth
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    Is a real estate appraiser a good job?

    Posted: 31 Dec 2020 11:42 PM PST

    My sisters a real estate agent and she's always talking about how being an appraiser could be a good job for me, she says they make good pay especially if you work for yourself.

    submitted by /u/jahreazer24
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    Do homebuyers seek terrazzo floors? Does restoring terrazzo floors add value to the property?

    Posted: 31 Dec 2020 02:40 PM PST

    We recently purchased a property that has terrazzo flooring. However it has several carpet holes. Is worth paying to have them restored? Does it add value of any kind to the property?

    I was quoted 7k to fill in the holes, grind, and polish. Is this something people see value in when purchasing a home? All feedback would be appreciated. Thanks!

    submitted by /u/NiloKings
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    20 year old interested in getting into the real estate game

    Posted: 01 Jan 2021 04:36 AM PST

    hey guys. I want to get into the real estate game. I grew up in New York. am currently living in Indiana to be closer to my fathers business. I really want to start pursuing my real estate license and start making money. Any tips? am I in the right sub reddit? is Indiana a good place to start?

    submitted by /u/aj2official
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    Appraisals (CA - LA Area)

    Posted: 31 Dec 2020 06:49 PM PST

    Hi All! I am in LA and everything decent has had multiple offers going significantly higher than list price. For people on here in the LA area who offered way more than list, did your appraisal match up to your offer price? Was it somewhat close? Did the appraiser use recent comps like the last month? Or did they use comps from 5-6 months ago when the market wasn't as hot?

    My main concern with bidding wars is the appraisal coming in short. I have some extra cash I could put in, but not a huge amount. TIA!

    submitted by /u/kandidkats
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    Price of homes going down further in NY?

    Posted: 01 Jan 2021 07:50 AM PST

    It's January 2021. Are the prices for homes getting lower for Rockland County, NY? Or are they as low as could be expected? What sources would you recommend for following the price trend. Thanks...!

    submitted by /u/sreknoy
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    Stuck between a rock and a HUD place

    Posted: 31 Dec 2020 02:28 PM PST

    Thank you for your attention. Located in Texas.

    We are in the process of trying to purchase a repossessed HUD home. We are owner occupants and won the bid in the initial phase. Due to the holidays, we are now past the back out period.

    HUD disclosed that there was a unknown leak that was discovered by the utility company (who removed the water meter completely). We have consulted with a plumber we trust and even worst case senario (such as it being under the foundation) we are still willing to move forward knowing the potential cost of having a major problem repaired.

    We want this house SO BAD. We have emotionally invested into the remodeling we want to do to make this our perfect home.

    Here's our problem. We requested authorization to turn on the utilities for the lender to do the appraisal required for the mortgage. HUD denied our request to turn on the water. Without the appraisal, we can't get funding (which we would get having great credit, and at an amazing interest rate). Without funding, we aren't willing to go bankrupt by paying cash up front. HUD is preventing us from doing something required by our lender to buy this house.

    We want this house. Real bad. What do we do?

    submitted by /u/Spicyshrimpsushi
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    Question about an inherited mortgage.

    Posted: 31 Dec 2020 06:14 PM PST

    So I am creating a will for the first time in my life and it mainly bc I'm developing a decent amount of equity in my condo.

    I tried to refinance earlier this year and it was t worth it because I only owe about $70k and banks don't seem interested in refinancing mortgages that low.

    That got me thinking... if I leave my condo to someone and they decide to keep it instead of selling it - can they just take over the mortgage? How would they keep the place if they wanted it?

    submitted by /u/FloridaManCometh
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    Buy or Rent...

    Posted: 01 Jan 2021 02:12 AM PST

    My wife and I need some advice regarding first time home buying or should we continue renting.

    We are looking to buy a new build in Georgia, 340k home. We have 33k in savings, combined gross 160k, both have strong 401k's, credit scores are 804 and 760 and have zero debt. We focused the past few years on paying off our student loans and car notes… all while renting. My biggest concerns are my job, the down payment/closing cost and general fear of home ownership. I work for the Federal Gov. and could be moving in 3-4 years, if that happens the Gov. will pay to move me and will buy our home after they have 3 different appraisers conduct appraisals (median value is given), or I can choose to sell on my own. Putting a minimum down payment seems like our only option unless we want to blow through our savings or pull from our 401k's (which I do not want to do). If I knew I would be in this house for 10 plus years I would not have such hesitation, however, with my career and the chance of moving in a few years I am worried I would be under on the house if that time came. We currently spend $1650 a month in rent but our utilities are covered, I am sick of paying rent and do not really want to spend another 3 plus years renting. Should we try and secure an FHA loan? Given our circumstance would it be wise to buy or continue to rent? Any and all advice is welcome…

    submitted by /u/FarmerExtension8472
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    Thoughts on placing offer on parents home.

    Posted: 01 Jan 2021 01:39 AM PST

    My parents own a house just outside of the town I live in. They have retired and have moved out of the area, however stilll own the house though mostly using for storage. The home has since fallen in horrible disrepair in the years since they have moved away and would cost much more than it's worth to fix it up. The lot is a few acres. I feel like any offer I would give them would be a slap in face because I have a rough idea of what they paid, but feel like it's worth nowhere near that with the home in such disrepair. How should I go about giving them an offer on their property considering that I feel like the property is just worth the land and I would have to pay to demolish the house before I could do anything with it?

    submitted by /u/Rando_Guy_07
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    (SF Bay Area) What questions can I ask a real estate agent when interviewing to sell a house?

    Posted: 31 Dec 2020 03:43 PM PST

    I'm a first-time home seller looking to sell my house in the SF Bay Area in the next couple of months. I'm starting the process now and calling some real estate agents in my area. I'm wondering what kind of questions I can ask the agents without getting too intrusive. I don't want them to think I'm trying to squeeze free advice from them.

    Can I ask how much they think they can sell the house for, how much of a discount they would offer in terms of commissions, what sort of techniques or advantages they would use, what their opinion on what changes the house needs, who their contractors are, etc?

    Also, are there any other questions I should ask the real estate agents?

    submitted by /u/backward_s
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    New construction home - Is this mold in the attic?

    Posted: 31 Dec 2020 09:19 PM PST

    This came up during my home inspection:https://imgur.com/a/wKs2ZDZ

    Is this mold? Does it need to be removed/treated? I got a quote for $595 from a local "Mold Solution" company to have it removed.

    The builder/seller doesn't want to pay for it and said it shouldn't be an issue. He said it is common in that type of lumber and is not mold. (I forgot the exact terms he used). He also mentioned even if it is mold, it wouldn't grow due to lack of moisture and proper ventilation in the attic.

    submitted by /u/aznffl
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    Thinking about leaving my corporate life in America to buy a hostel in South America & run it as an Airbnb. Has anyone done something similar? Or know someone who has?

    Posted: 31 Dec 2020 11:20 AM PST

    31, have about 100k saved up, have a nice comfy career as a software engineer ... however I feel like my soul & body is slowly decaying doing this type of work. I need a change. As the title implies, I'd like to buy a humble hostel type property in which I'd live in & rent out on AirBnb to travelers.

    Would love to hear some firsthand stories if you or anyone you know / know of has done something similar.

    ​

    Thanks.

    submitted by /u/krame_krome
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    Two houses on my property

    Posted: 31 Dec 2020 08:47 PM PST

    So this is going to be quite a ramble, and I'm not even sure what my main question is, but I would really appreciate some comments from some people wiser in this area than I. Please ask questions if I have left any info out; I could only guess at what info was relevant here, and as such, included some stray facts and questions to help explain things.

    We bought a property in May, consisting of 3 parcels. The large parcel includes our home, but it also has a 2nd home in its "backyard." The second home is much older, and actually faces a road and has its own address. We, of course, live in the nice, newer house. The new one is essentially the house we bought, but now we also own the old home on the property (and paid for it too). But now, we're wondering what to do with it.

    Our mortgage company has told us that if we add ~18,000 in value to our property, we can refinance with a significantly better interest rate. Even though the second home is not a primary residence (though it is on the property of our primary residence), if we renovate the second house to make it livable, even if no one is presently living in it, can we get a new appraisal of both homes together and increase the total value of the property? Maybe that's my main question there.

    ​

    Stray facts:

    -- The appraisal that accompanied our buying process referred to the second home (since it was unlivable) as a workshop

    -- The mother of the previous owner lived in the old home for years; when she died, they moved into it, and subsequently had the new house built on the property.

    -- The old house was gutted. e.g. it's missing some of the plumbing and fixtures, hot water tank, furnace.

    -- the old house has its own separate physical address, but the county assessor shows that it's on the same parcel as our own home

    -- We did have an inspector of sorts give the place a decent once-over, and they reported back that there are some utilities and other necessary updates, but otherwise, though it's dirty and clearly unlived-in for many years, it's got pretty good bones and no foundation issues.

    ​

    Stray questions:

    -- a dumb one . . . I suppose my property tax paid to the county will go up if we renovate the house up to being livable?

    -- are there any unforeseen (to me) consequences of owning two livable residences, but only living in one? I'm thinking about confusing the mortgage company, messing up my taxes, etc. (I don't really even know what else.

    -- what makes a house livable, technically-speaking? Is there even a technical meaning of the word?

    -- anyone else with a clever idea of what to do with the property? Demolishing would be pricier, and honestly provide little to no benefit. Leaving it there is just a bit of an eyesore, but that's it.

    submitted by /u/brmoser
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    NMLS - Texas SML

    Posted: 31 Dec 2020 08:42 PM PST

    Hi! New user here and hopeful future mortgage loan originator in Texas. I took my exam Nov 2020 and began the license application process. Already did fingerprints and submitted request for credit report. Since submitting and attesting my application, my license status shows Pending- Incomplete however, there are no active line items. I've emailed Texas SML licensing department already and no response to email and no updates on NMLS website. Dec. 31, 2020 now and wondering if there is anything else I can/ should do. Am I missing something perhaps? I've gone through all items on left side of screen and navigated through site as best as I can and have not been able to come up with anything. Any advice would be deeply appreciated!

    submitted by /u/Pure-Razzmatazz-408
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