Personal Finance

Buying a house, how much off the asking price?

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  • Mar 14th, 2009 12:53 pm
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[OP]
Deal Addict
Jan 13, 2007
4278 posts
300 upvotes

Buying a house, how much off the asking price?

For those who recently bought a house how much did you pay (percentage of course)?
Also for those looking to buy, how much would you bid?
67 replies
Deal Addict
May 28, 2006
2291 posts
160 upvotes
95% of the original asking price. I had a number in mind that I would be willing to settle at but not go above that number. So I put an offer in that would be less than $10k that max number in hopes they counter close to my number.

If they counter and don't say final offer (take it or leave it) I'd know to do a final counter offer close to my original offer. If they don't like it they can try to middle their counter-offer with my counter-offer which would result in an even lower number.
Sr. Member
User avatar
Dec 11, 2006
546 posts
2 upvotes
Vancouver
Sale to list price ratio out west has been around 93-95% for the last year or more. I would go so far as offering 8-10% below to start depending on the market you're in. 5% below seems like a standard.
Sr. Member
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Sep 21, 2003
865 posts
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In a normal market I would agree that 90 - 95% would be a good starting offer but these days, who knows.

Houses here in Vancouver are on the market for 25% less than they were last year at this time, and they aren't moving. A motivated seller might jump at almost any semi reasonable offer.
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Deal Fanatic
Dec 11, 2008
6253 posts
244 upvotes
Don't base it on asking price, do it based on comparable sales price.

Use the recent sales figures and comparables and offer at least 5% below.
Deal Addict
Mar 14, 2005
1791 posts
36 upvotes
It's really a case by case basis...

If the house has been on the market for 120+ days, perhaps you can even throw a low ball offer ($40K - $50K below asking or 10-20% below) and get it accepted. If the house has been on the market 10 days, little chance...

The biggest determinant is the sellers motivation. If the seller is carrying a vacant home because they moved into their other home, maybe you can try a low offer to start and go from there.. Some sellers may tell you to go F--- yourself, others may negotiate.. You never know until you try..

At the end of the day, in this market, there is no rule of thumb, offer what you can (pay attention to comps. but be mindful of any comps prior to the Fall of 2008 as the world has changed a lot since then.
Deal Addict
Mar 14, 2005
1791 posts
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One more thing. I've noticed that homes in the higher price range $500K + seem to be getting hit a bit more than homes under that price, which in some cases are still getting multiple offers and selling for prices similar to last year.

Thus, more negotiating room in the higher end of the market.
Sr. Member
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Sep 10, 2004
682 posts
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xstatik wrote:
Mar 6th, 2009 1:51 pm
One more thing. I've noticed that homes in the higher price range $500K + seem to be getting hit a bit more than homes under that price, which in some cases are still getting multiple offers and selling for prices similar to last year.

Thus, more negotiating room in the higher end of the market.
Thats understandable. People who would normally have purchased say a 250-400k home (i.e. your average home-buyer), are more willing to stretch their budgets when times are good. As a result, these consumers buy homes approaching the upper-mid end of the market (500 -700 K). When times are bad, the average home-buyers are no longer looking at the 500-700 K range, demand drops and so do prices.

On another note, I would not expect high-end properties (1 million +) to drop significantly because those are niche markets. I base my numbers on Ottawa real estate.
Deal Expert
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Dec 19, 2001
28475 posts
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Fernando Po
I've bought two houses. The first was 15% below asking, the second 20% below. I'd start at 20% and if the house is worth it, I'd go as far as 10% below. If they don't budge, I'd move on.
Member
Apr 21, 2007
312 posts
10 upvotes
hagbard wrote:
Mar 6th, 2009 9:13 am
I've bought two houses. The first was 15% below asking, the second 20% below. I'd start at 20% and if the house is worth it, I'd go as far as 10% below. If they don't budge, I'd move on.
I agree with this completely. I've never paid closer than 15%. That includes during boom times. It's not a process that should be rushed (unless necessary) there are always houses on the market. There are always people who need to make a deal.

I think i'd make an exception if i ever found the elusive dream house. But then again its easier to create a dream house with the money you save.
Sr. Member
Aug 6, 2001
526 posts
3 upvotes
I agree with speedyform, you really have to judge the price on comparables rather than asking price. If someone is asking 20% over market value for thier house, then you would want to offer 20-25% below. (Althought it won't likely be accepted - these sellers are usually delusional!) If they are asking under market value, you would be well advised to offer 95% to asking. What houses are listed at is often not an accurate indicator of what they are worth.
Sr. Member
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Jan 13, 2007
827 posts
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hagbard wrote:
Mar 6th, 2009 9:13 am
I've bought two houses. The first was 15% below asking, the second 20% below. I'd start at 20% and if the house is worth it, I'd go as far as 10% below. If they don't budge, I'd move on.
if i listed my house at 500k and you offered me 400k, i wouldn't know whether to laugh, or be pissed.
Deal Addict
Mar 14, 2005
1791 posts
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Ebtek wrote:
Mar 6th, 2009 2:36 pm
if i listed my house at 500k and you offered me 400k, i wouldn't know whether to laugh, or be pissed.
But if your home has been on the market for over 100 days, you might even consider that offer..

Wouldn't you put an offer like that if you saw a home on the market for a long time???

It all depends on the seller motivations (moving for work, leaving the country, bought another home, divorce etc).
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