How Much Do I Offer?

Probably one of the most common questions I am asked and sometimes one that I cannot answer off the top of my head.  Many times it requires a bit of research on my part before I can give you an educated opinion on what I feel you should offer.  That is because I need time to examine recently sold properties and active listings available in the local MLS.  From this market analysis (CMA) and my personal knowledge I can provide insight into the market in general and the specific property you are considering.  These are also important details that should be factored into your offer.  They include:

Market Facts
1.  Price of Similar Properties - with more weight placed on comparable sold properties.
2.  Price Trends - what percentageof list price to sales price is happening in the market.
3.  Absorption Rate - What number of months (or years) of inventory supply is available.  The smaller the number the more competitive the market is for buyers.
4.  Average days on market - because listings expire and many times are listed with another agent I make sure to share the cummulative days on market.

Property Facts
1.  Property Condition - is the property in good condition or will substantial investments be needed to repair.  This also determines how large the pool of buyers is as homes needing work cannot be easily financed.
2.  Lenght of time on the Market - A long time on the market could indicate a slow market, inappropriate pricing or poor marketing or potentially a problem with the property.
3.  Seller's Motivation - a seller under pressure to close a deal may be more receptive than one who can wait until "the right offer comes along" or  a seller who "won't give it away".
4.  Terms - what terms and contingencies must be written into your offer?  Terms that make your offer more attractive include all cash, pre approval for financing letters included, quick closings, few other contingencies and no need for sellers concessions.