Do you think you’re stuck paying full price for a condo? You might be surprised. Most buyers only look at condos in their price range, sometimes pushing the limit to the very max, but most don’t look beyond their price range.
Until Jack and Kari came along.
A great couple I had the pleasure of working with this last month. They were looking for a condo in Panama City Beach as a vacation home. They planned on using it for a few months and renting it out the rest of the time. We looked at condos on both sides of the street but they couldn’t find anything they liked in their price range.
So we went higher. Jack and Kari were approved for $300,000 and up until now, that’s as far as we looked. But we decided to go up to $380,000. Now, I know they couldn’t afford that high of a price but we did some serious research. I looked up condos that fit their search criteria and did the background research on the listing. We found12 condos that matched what they were looking for priced from $330,00 – $375,000. 5 were new listings and 7 had been on the market for more than 3 months. With additional research, we found out that 2 of them had received offers but the deal fell through after inspection, which told us there was more going on with the property than my buyers wanted to deal with.
I inquired about the other 5 and asked why the homes haven’t sold. 1 agent told me the sellers were firm on the price and didn’t need to sell fast. 1 agent said the condo had multiple offers in the first few weeks but the sellers wanted to hold out for more but hadn’t received any other offers since. I asked what their lowest was and he said $320,000. That was still too high for us.
The highest priced condo was listed at $375,000 but for the area, the building and the size, I could tell it was way overpriced. I asked about it and the listing agent said the seller wanted to get rid of the property but wanted as much as they could. However, time was ticking and now they needed to sell. The condo was paid off, so the seller didn’t owe anything on the property.
BINGO….
This was our place. We first asked if an offer of $250,000 would even be acceptable. This was our test to feel out the seller and see if they would even entertain our offer. The agent said “no way” right off the bat, but with a little pressure, I asked if the agent would at least talk to the seller about it. He agreed.
The seller came back and said no, BUT make an offer anyway. Perfect! This means the line of communication is open. We made an offer of $255,000 with very few contingencies and a solid offer with dates appealing to the seller. We got a counter offer of $300,000.
I went back to the lender and asked her to write up a pre-approval letter for $260,000. This means the buyer can afford this amount but the seller doesn’t know if they can afford anymore. I asked the agent what the seller needed besides price. He said the seller wanted to close in 3 weeks and not do any work on the property. We re-countered the offer at $260,000 with a fast closing, home inspection contingency with the written agreement the buyer wouldn’t ask for repairs (fine to do, only if you still HAVE the inspection so you know what you’re getting into) and the deal was accepted!
Can you believe it!? 30% lower than the asking price… $115,000 less than asking price and the buyers got a great condo!
Can this happen with everyone? Maybe not, but each deal is different. It pays to have an agent that knows the area, the market and how to negotiate with sellers and listing agents. The last thing you want to do is piss off the seller even though you can offer a lower price.
Want to see how much condo you can get? Call me anytime! And congratulations Jack and Kari!!! 🙂
Thank you to Bob Jamison of Tuscana Properties for his article – Looking for the best zip codes to invest in real estate in San Jose? Give Bob a call!