Expert: Hans Weber, Licensed Broker Associate - 7/1/2008

Question
Hi, there. My husband and I are hoping to buy our first home. We found one we like but I found out also that the seller bought it about 8 months ago and fixed it up to sell. It has a new roof, new kitchen (with very few cupboards), new hardwoods, new furnace & hot water, new interior & exterior paint, new bathrooms, and a new upstairs laundry room. We love it! Problem is, we have no idea what to offer on it.
-We've been pre-approved but we want the seller to pay the closing costs.
-This house has been on the market for about 5 months.   
-The asking price is 159,900. But nearby houses of comparable age, square footage and lot size are selling for around 130,000. However, I'm willing to bet they don't have all the updates this house has.

Do you have any idea how much we should offer?
Also, how good of a resource are Trulia and Zillow?

Thanks so much,
Sara :)


Answer
Hello Sara:)

Thank you for your question.

From your description it sounds like the house is a bargain. If unupdated houses are selling for 130 add (NY Cost) roof 5k, kitchen 10k, 2 baths 5k each, paint 3-5k, furnace 5k, water heater 1k, new ood floors 5k, laundry room 2k.

Based on what you are saying I seems you are not working with a buyers agent?  A Realtor buyers' agent would be able to tell you what recent comparable sales were so you could make a fair market value offer on the house.

Trulia and Zillow are not exact enough to give you a fair price.  They don't inspect the houses.

You can go to the local tax assessor's office and find out what the seller paid for the house.  Add value for the improvements and figure an offer that way.

Closing costs could be paid by the seller if they are motivated. In some cases the closing costs can be added to the price by the buyer after agreeing on the net price and thereby added into the mortgage.

Anyway, if you love the house, buy it.  Since you are getting a mortgage from a bank they will do an appraisal.  If there is a problem with the valuation they will require an adjustment in the downpayment or price to reflect any lower value.


Good luck in your new home.

Hans:{)