Yes, real estate prices have been going up -- 4-6% in the last year. The real estate market has gone from a buyer's market in 2009 - 2011 to a seller's market from 2013 until now. It's tough to get the house you want at a below market price, but it's not impossible to find a great home at a fair price.
Most local Alpharetta area house buyers have quite a few questions, including:
- In this seller's market, how much lower than the list price will a buyer accept?
- How do you, as a buyer, make the right first offer on a house for sale in north Fulton County and southern Forsyth County?
Even in a seller's market, it is possible to buy at less than asking price, and you can increase your chances by following the tips below. You will also need to know how to negotiate a lower price on a house when the house is already a good deal. Of course there are determining factors in each individual situation, but knowing a few of the "rules of thumb" will help you to get the house you want at the price you can afford. Every buyer wants to pay the least possible for the most house. Right? Here are a few tips to help get you started.
General Rules of Thumb for Buying Any House in a Seller's Market:
1. If a property has been on the market less than a week - A newly listed property (if it appears to be priced correctly) means most sellers will not come down more than 3% of the asking price. 2. If you are in a multiple offer situation with 3-5 offers - You should expect the house to sell at full price or 2-3% above asking price. 3. If you are in a multiple offer situation with 10+ offers - You should expect to pay a minimum of 5% above list price (and offers higher than 5% are not uncommon) to buy the house. 4. If the property has been on the market for 21 days without a price reduction - The property will probably not sell at listing price and you can expect about a 2-3% lower-than-asking-price offer to be accepted. 5. If the property has been on the market for 60 days without a price reduction- The market is saying the price is not accurate for this property. It's important for your buyer's agent to research recent sales and determine what the actual price for the property should be to help guide you in making a successful offer. The final sales price will probably be 5% or more lower than the asking price.
Five Things that Will Impact the Sales Price of a Specific House:
1. How long the house is on the market - The longer the house has been for sale, the more anxious the seller will probably be to sell, a fact you can leverage. 2. The house is empty - It represents a payment for the owner and they are much more likely to negotiate. 3. There multiple offers - If you or your real estate agent can determine that there are multiple offers, it will negatively impact your buying power. The seller has other options, so move forward carefully with lower priced offers if you want this particular house. 4. The Amount of Seller's Equity - If the seller has no equity, there's little "wiggle room" on the price for the seller. A seasoned real estate agent will know how to compare the original purchase price and date from public records. Armed with that information and a few experienced-based calculations, your agent will be able to advise you on the probable equity situation. This will help you to determine what price you should offer for a particular house. 5. The seller's current situation - Are they looking for a house, or do they already have a house under contract or purchased? Is the sale precipitated by a move out of the area? A good buyer's agent will ask questions to determine how soon a house will be available for the buyer to occupy -- during that conversation, information about the seller's motivation and factors influencing that will be gleaned. That information will help the buyer determine how anxious the seller is to sell the house, even at at a lower price. Note: These percentages listed above represent the net sales differences, they are not going to take this off the sales price -- or can take that off the closing costs -- but they will not pay closing costs AND take this percentage off the sales price.
If You Want a Particular Alpharetta Area HouseSome buyers are looking for a house that has the items they most want. They are looking for a great deal in a house that will meet their needs. They are strictly logical about the purchase. Other times, a buyer "falls in love" with a particular house. In a seller's market, that dictates a different game-plan. If that 's the case for you, you should understand that a seller's market means that a successful offer won't be the least amount you can offer, but rather that the offer you need to make might be HIGHER (rather than lower) than the asking price. A seasoned real estate agent will help you negotiate to get the house you want. A good agent will help you find a house you want and will help you make a lower offer, if possible based on the circumstances -- and will help you make an offer high enough to land the house if that is what is necessary. These guidelines may not apply in every situation, but in my years of experience these are the general rules. There are always exceptions on both sides. If you need personal assistance to find the perfect house in Alpharetta, Johns Creek, or another community in north Fulton County or southern Forsyth County, call me. I'll be happy to help you navigate the process and provide you with the information and experience you need to negotiate the purchase.