Condo hunting...

[DanTMWTMP]

It's a friggin buyer's market now, and I'm in the hunt (in San Diego, no less :Q).

Anyways, what is a reasonable amount to lowball? Let's say a small 1000 sq ft, 2bed 2 bath place w/ remodeled interior (floor is hardwood, remodeled kitchen/bath, paint is in excellent condition) is selling for ~210k. The condo community was built in 1972. In its recent history, the placed was valued around 120k in the year 2000, and 450k in 2004-6. The location is a VERY nice part of San Diego. It's the ONLY place in the area within a price range where I can more than afford.

What is the lowest offer I can produce to the seller? Is 180k reasonable? Is there like a back-and-forth battle of prices between prospective sellers and I?

It's been on the market for more than a month now.

Any other tips on condo/house hunting will be very much appreciated. I'm such a noob at this, and I also feel I'm rushing into this. Should I wait it out one-two more years and see how it goes? My credit score is ~760

What's the best way to minimize closing costs?

 

[JohnAn2112]

How long has the condo been on the market?

Doh, didn't read. I see that it's been on the market for a month.

 

[OCGuy]

There is no "safe-zone" for low-balling. Rates are very low right now, so losing the house you want over 10K is probably not a great idea.

Definately low ball it though, as the worst they will do is say "no" or counter.


Also, make sure you have a pre-approval from a bank/lender to send over with the offer.

It is better to give them close to what they want, and have them credit your closing costs. :thumbsup:

 

[DanTMWTMP]

Is it possible to get a rixed rate? Thanks OCguy. I asked a close friend of mine (he's a broker) on some advice over lenders. He said he can actually get me approved for loans. He said w/ my fico, he can possibly get me something around 5% or less fixed Q).


EDIT: any tips on minimizing closing costs?

 

[rgwalt]

I'm in the process of buying a place right now, and my rate is in the 4's. Now is a great time to buy if you have the money and you have job security. Shop around your interest rate and lender fees. A great rate may come with a ton of fees (and thus not be that great). Lending Tree wouldn't be a bad place to start. Also check with whoever you bank with.

As far as what to offer, I would definitely talk to a realtor and have him/her pull "comps" in the area. See what similar places have been selling for. 1 month on the market is nothing in real estate. To be on the market "a long time" a house would need to sit for at least 6 months. Even with 1 month on the market, it is tough to tell how "aggressively" the seller has priced the home. Usually an offer of 10% below asking is a good starting point, but there is nothing "usual" about the housing market.

Google "first time home buying" and read up as much as possible on what to expect and how the process works. Then I would recommend finding a realtor to work with.

Best of luck!!!

R

 

[OCGuy]

Originally posted by: DanTMWTMP
Is it possible to get a rixed rate? Thanks OCguy. I asked a close friend of mine (he's a broker) on some advice over lenders. He said he can actually get me approved for loans. He said w/ my fico, he can possibly get me something around 5% or less fixed Q).


EDIT: any tips on minimizing closing costs?

Yes par rates are around 4.625% today at my best bank before risk adjustments.

As far as closing costs, just get the seller to pay them for you. In this market, most sellers are happy to do it if it means making the sale.

 

[DanTMWTMP]

Originally posted by: Ocguy31

Originally posted by: DanTMWTMP
Is it possible to get a rixed rate? Thanks OCguy. I asked a close friend of mine (he's a broker) on some advice over lenders. He said he can actually get me approved for loans. He said w/ my fico, he can possibly get me something around 5% or less fixed Q).


EDIT: any tips on minimizing closing costs?

Yes par rates are around 4.625% today at my best bank before risk adjustments.

As far as closing costs, just get the seller to pay them for you. In this market, most sellers are happy to do it if it means making the sale.

Do I tell the seller to cover the closing costs after an agreement on the price has been made?
Let's say we agree on 190k, and it costs ~10k in closing costs. Can I have that 200k loan after the fact?

Not that I cannot afford it, but I need a buffer in life in terms of what I have in the bank at any given moment (i have good job security, but you never know...what if my car breaks down, freak accidents, family emergencies, etc..).

EDIT:
BTW, rgwalt and Ocguy31 (and anyone else who will pitch in) you guys rule. Thanks SOO MUCH for this advice. I'm sure it's helpful for anyone looking in the thread as well.

 

[OCGuy]

Originally posted by: DanTMWTMP

Originally posted by: Ocguy31

Originally posted by: DanTMWTMP
Is it possible to get a rixed rate? Thanks OCguy. I asked a close friend of mine (he's a broker) on some advice over lenders. He said he can actually get me approved for loans. He said w/ my fico, he can possibly get me something around 5% or less fixed Q).


EDIT: any tips on minimizing closing costs?

Yes par rates are around 4.625% today at my best bank before risk adjustments.

As far as closing costs, just get the seller to pay them for you. In this market, most sellers are happy to do it if it means making the sale.

Do I tell the seller to cover the closing costs after an agreement on the price has been made?
Let's say we agree on 190k, and it costs ~10k in closing costs. Can I have that 200k loan after the fact?

Not that I cannot afford it, but I need a buffer in life in terms of what I have in the bank at any given moment (i have good job security, but you never know...what if my car breaks down, freak accidents, family emergencies, etc..).

EDIT:
BTW, rgwalt and Ocguy31 (and anyone else who will pitch in) you guys rule. Thanks SOO MUCH for this advice. I'm sure it's helpful for anyone looking in the thread as well.

Your real estate agent will know what to do. Basically in the offer, it lays out the price you are willing to pay, along with any conditions. One of the conditions will be "Seller to credit $X to borrower's closing costs".

 

[BlahBlahYouToo]

wtf? only $210k?
i thoguth san diego (or any metro area in CA) was expensive.

 

[SearchMaster]

Originally posted by: Ocguy31

Originally posted by: DanTMWTMP

Originally posted by: Ocguy31

Originally posted by: DanTMWTMP
Is it possible to get a rixed rate? Thanks OCguy. I asked a close friend of mine (he's a broker) on some advice over lenders. He said he can actually get me approved for loans. He said w/ my fico, he can possibly get me something around 5% or less fixed Q).


EDIT: any tips on minimizing closing costs?

Yes par rates are around 4.625% today at my best bank before risk adjustments.

As far as closing costs, just get the seller to pay them for you. In this market, most sellers are happy to do it if it means making the sale.

Do I tell the seller to cover the closing costs after an agreement on the price has been made?
Let's say we agree on 190k, and it costs ~10k in closing costs. Can I have that 200k loan after the fact?

Not that I cannot afford it, but I need a buffer in life in terms of what I have in the bank at any given moment (i have good job security, but you never know...what if my car breaks down, freak accidents, family emergencies, etc..).

EDIT:
BTW, rgwalt and Ocguy31 (and anyone else who will pitch in) you guys rule. Thanks SOO MUCH for this advice. I'm sure it's helpful for anyone looking in the thread as well.

Your real estate agent will know what to do. Basically in the offer, it lays out the price you are willing to pay, along with any conditions. One of the conditions will be "Seller to credit $X to borrower's closing costs".

They will also know what a reasonable price for the property is based on recently sold comparables. If 210K is a fair price, you may not be able to negotiate much off unless you have a very motivated seller.

 

[DanTMWTMP]

Originally posted by: BlahBlahYouToo
wtf? only $210k?
i thoguth san diego (or any metro area in CA) was expensive.

It is. Note that this is a condo, and it's a bit less than 1000 sq. ft. Everything else around this area is into the 400-1 million. Location is key too. I just happened on one condo complex that's selling cheaply in a relatively nicer area of SD (west poway/rancho pen./carmel mtn area).

 

[Greenman]

Is the exterior of the building in good shape? You might be in line to have the exterior re-sided/painted, perhaps new roofs, or the common areas may be needing upgrades. All of those things will get you a special assessment that could run into thousands. Also, 72 was before the cut off date for use of asbestos in building materials if that sort of thing bothers you.

 

[DanTMWTMP]

Originally posted by: Greenman
Is the exterior of the building in good shape? You might be in line to have the exterior re-sided/painted, perhaps new roofs, or the common areas may be needing upgrades. All of those things will get you a special assessment that could run into thousands. Also, 72 was before the cut off date for use of asbestos in building materials if that sort of thing bothers you.

Excellent information. Thanks, and I will really ask about this. The exterior appears to be in good shape, but I will have to have a much closer look; maybe get someone to inspect it? <--how do i go about getting someone to do that?

 

[wetech]

Originally posted by: DanTMWTMP

Originally posted by: Greenman
Is the exterior of the building in good shape? You might be in line to have the exterior re-sided/painted, perhaps new roofs, or the common areas may be needing upgrades. All of those things will get you a special assessment that could run into thousands. Also, 72 was before the cut off date for use of asbestos in building materials if that sort of thing bothers you.

Excellent information. Thanks, and I will really ask about this. The exterior appears to be in good shape, but I will have to have a much closer look; maybe get someone to inspect it? <--how do i go about getting someone to do that?

When you make the offer (and it's accepted), it's usual to have the closing be subject to an acceptable inspection. Your realtor should be able to recommend a good inspection company.

Also be sure that you make the closing subject to you accepting the condo bylaws. You don't want to buy the house and then find out that the bylaws are too restictive, condo fees too much, etc.

 

[Gibson486]

sounds like the seller wants a bidding war....

really... valued at double the price 2 years ago....in SD.....

 

[SJP0tato]

Originally posted by: rgwalt
As far as what to offer, I would definitely talk to a realtor and have him/her pull "comps" in the area. See what similar places have been selling for. 1 month on the market is nothing in real estate. To be on the market "a long time" a house would need to sit for at least 6 months. Even with 1 month on the market, it is tough to tell how "aggressively" the seller has priced the home. Usually an offer of 10% below asking is a good starting point, but there is nothing "usual" about the housing market.

In this market it's possible you can look at the comps, figure on a good price, haggle with the seller a bit and both agree on a good price...then have the bank send out an appraiser who says it's not worth the value you agreed on since it's a declining market. Then you haggle some more with the seller, or walk away.

It's the situation I'm in currently, but the seller is pretty unreasonable with coming down to 2009 real estate prices...