Unconventional way to look for house

deee_gwJune 4, 2011

We have been looking for a house for a year. As I have posted before, we are in a buyer's market but the prices and appraisals are a bit psycho. Because of the condition of the market, I know there must be pent up listings for people who are afraid of the market or don't want the hassle of selling right now.

I am considering putting this ad in our local paper

HOUSE WANTED

Permanent residence for local family. South end. Light and airy, min. 3 bedrooms and two baths, garage or room on lot for garage. Minor remodeling and cosmetic updates okay. Offering $X00k. Brokers protected.

If you are interested or if your home is currently on the market for a higher price and you are willing to accept less, email address and information to

aecia-xxxxxxxxxxxx.net

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sweet_tea

Don't say "offerring $XXX". You are not going to make any offers until you see the home and decide what that home is worth. Instead, say something like "$XXX or below" or give a price range.

Light and airy is too subjective. You will get calls from dark and dreary also.

Do you want a 1 car garage or is 2 car garage minimum?
" If you are interested..." is wasted words.

    Bookmark   June 4, 2011 at 11:14AM
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cas66ragtop

It's nice to see you are being creative, but I have my doubts as to how well this would really work. I doubt you will have many decent responses. You have now wasted money on a newspaper ad. Unless you list on Craigslist or some other free site - but then you gotta watch out for the Nigerian scam artists - haha!

Advertising your maximum price - people will have dollar signs in their eyes. Any time you tell people the maximum you are willing to pay, you will find that is conveniently the price they are also willing to sell for.

"Minor remodeling and cosmetic updates okay" - this will open the door for people with MAJOR repairs (who only think they are minor, or who will try to sucker you into thinking they are minor).

"garage or room on lot for garage" - this is too vague. People may think they have room to build a garage when they really don't. This also opens the door for people with an ancient 1 car frame garage that is falling apart that you would be afraid to park a bicycle inside (qualifying for "minor" repairs). Maybe you should think about making a garage a REQUIREMENT - and if you can't find anything acceptable, THEN you could settle for a place where you could build one.

"if your home is currently on the market for a higher price and you are willing to accept less" - extremely doubtful people will respond. They are not going to make you an offer. It is your job to go to through the proper channels, and make them an offer.

Who knows.......maybe you could attract an owner who is afraid to pay realtor commission, or who didn't think they could sell their house, and maybe you can create a FSBO situation. Anything is possible. Guess it doesn't hurt to try, but just be careful. I know it can be frustrating finding "the right house". You are doing the right thing by being a little picky and taking your time. Don't get discouraged - you WILL find the right one eventually.

    Bookmark   June 4, 2011 at 12:25PM
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cmarlin20

Do you currently have an agent? Do you want to buy in a specific area?
I'm asking because there is probably one or more agents that farm that area who have pocket listings. I would contact those agents asking about your specific perimeters.
Don't let the agent take over your life, a good agent will tell you what they have, try to make something work, but also let you move on if they don't have anything for you.

    Bookmark   June 4, 2011 at 12:41PM
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Sophie Wheeler

If you have been looking for a year with professional assistance, then either your criteria is unachievable or you are shopping out of your price range. I can't believe that in a buyer's market with numerous homes for sale that you can't find one that meets your wants. They sound like pretty simple requirements. That leaves price. Yes, the market is correcting downward, but it's no use going shopping for a 500K house with a 200K budget.

If you haven't been using an agent, then you really haven't been serious about purchasing. You've not used all of the resources at your disposal. A buyer would have found something by now. A shopper csn go on forever not being satisfied at finding the "perfect" house at the "perfect" price. Perfect doesn't exist. 90% perfect does.

    Bookmark   June 4, 2011 at 1:03PM
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deee_gw

We definitely are buyers but are being very cautious. We have narrowed our search to the very best locations because we don't know how long we will live here and have no idea when the market will stabilize. Real estate professionals (agents and mortgage brokers) in our area tell us not to buy unless we LOVE the house. Our paper is filled with foreclosure notices and prices continue to fall. If we had purchased a year ago we would have already lost at least 10% of our equity.

What prompted this idea is that a non distressed property that we admired recently sold for 70% of the listing price. We didn't bother wasting our agent's time because we thought it was out of our price range. I am sure there are sellers in the market and on the sidelines who are just as confused and frustrated as we are. I'm just trying to think of ways to find them.

Thanks for the tip about pocket listings. I will speak to our agent about that.

    Bookmark   June 4, 2011 at 2:01PM
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terriks

We have narrowed our search to the very best locations because we don't know how long we will live here and have no idea when the market will stabilize.

It sounds like you should probably continue renting then.

Also, many people are dropping their newspaper subscriptions, and I'm not sure if home sellers would think of looking in the classifeds to find a buyer.

    Bookmark   June 4, 2011 at 5:27PM
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sweet_tea

just start making offers on homes that you like, but are priced higher. like the one that sold for 70% of asking. you will eventually get a geat deal. don't worry about wasting time, this is what agents in business for - to make a sale. If sellers don't want to go forward with the deal, then you move on to the next one. just be preparared to do this for several homes before you get the great deal. you have nothing to lose.

    Bookmark   June 4, 2011 at 5:43PM
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jane__ny

Dee, I agree with you and have been thinking about doing something similar. We have been condo shopping for a year and prices keep dropping. But there are many people who continue to list their condos at high prices. Yet, I see what price they accepted, after they close.

I decided to made some low-ball offers on a few to see how negotiable the price is. My agent does not like to make low-ball offers; I don't like to either, but there are some properties which are over-priced and have been listed for 2+ years without price reductions. I just saw a listing I liked sell for $80,000 below their list price. I was so upset as I felt the list price was way above my price range and didn't make an offer. They never reduced their price on their listing. I see that often.

I can't understand why sellers are not reducing prices on their listings yet will accept an offer way below list.

I think you should give it a try and see what happens. Please post back what you decide to do. The whole market is so strange!

Jane

    Bookmark   June 5, 2011 at 4:11PM
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ncrealestateguy

Deee,
Ask your agent to run an Expired and Withdrawn search with your criteria for the past three years. The returns from the search will be persons who failed to sell in the last three years. Some of these are persons that would love to sell, but do not think it is worth the effort.
I often do this for clients with very specific criteria and only a few search results. I put together a deal last fall by finding my buyers home using a 3 year old Expired search.
Doing it this way will greatly increase your chances of running into someone that is willing to deal with you.

    Bookmark   June 6, 2011 at 9:24AM
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gmp3

If there is a specific neighborhood you are interested in you might do better flyering the area. I know one person (who I consider a bit crazy) who rang the doorbell of a house they liked. The person sold it to them! I also kow someone who had someone knock at the door and ask about their home which was not for sale, however they were planning to list within a year so they were able to make a deal. Be aware though that homes that are prepped for sale are going to look better than the typically well-maintained home. We take very good care of our home and it still took 3 months to get all the little things up to par. What do you consider "minor cosmetic" updates? Countertops? Carpet? Paint? Some buyers consider them minor, some consider them major depending on the age of the home, etc.

Like a previous poster said before, you still aren't going to get a 500K home for 200K. There is something to be said for good enough, how long to you want to agonize over getting the best deal before getting on with your life?

    Bookmark   June 6, 2011 at 12:49PM
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chisue

About 10 years ago we wanted to buy a specific model vacation rental condo in a specific complex on Maui. Realtors were not helpful. It was during a slow market, and they were even slower, despite the fact that we HAD to make a deal before our 1031 time ran out (180 days).

We obtained a list of owners and mailed to all who owned the model we wanted, just asking if they were interested in selling. We had a couple of responses from owners on 'fishing expeditions' but found also two good possibilities. One man was willing to gut and rework his unit for us. We made a deal. We went out to Maui in a few months, moved into the nearly completed unit for our first night's stay and closed on the condo the next day. We've had no reason to feel this wasn't a wonderful decision!

We did something similar before we bought our present home. I asked a Realtor friend to mail to owners of a dozen likely properties in the neighborhood we wanted. We could have done this direct, but I wanted an experienced negotiator involved. We didn't end up buying this way, but did buy in the neighborhood and paid our Realtor friend a percentage for his services. (It was a gift; he never asked for payment.)

    Bookmark   June 6, 2011 at 1:11PM
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weedyacres

I doubt an ad in the classifieds would be read by prospective sellers.

I'm going to be moving 100 miles away sometime in the future, and have driven around looking at neighborhoods. I'm thinking when the time comes of mailing letters to everyone in the 2 or 3 neighborhoods I like saying that I'm looking to buy in their neighborhood. I suspect there are some "sleepers" out there that are waiting for things to pick up before they go to the trouble of listing.

    Bookmark   June 6, 2011 at 2:31PM
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Jamie

There might be additional venues besides the local newspaper, but I think you idea is a very good one.

Here's why.

We lived in a suburb of detroit where everyone was staying put because they didn't want to lose their shirts. We had been planning on moving for several years and did not want to let the economy stop us. The only homes that were selling were going very low, but because there were so few homes on the market, we were able to sell at smaller loss than we thought we'd have to. (We bought in 2006. Most of the neighbors bought long before that and have stayed put a very, very long time.

So couple of things.
1. In an established, stable neighborhood people who have been in there homes for 15 years or more and have few comps to refer to have no idea what to ask for their homes. YOur number might suit them just fine. They might be sitting there thinking "I'd love to move" and have no idea what they could get, or believe that they'd have to remodel the kitchen or whatever before they could get out without taking a licking. (Some of those tv shows are really warped.)

These people might see your number and think "Freedom!".

2. After we sold in under a month I noticed two things: The only other neighbor whose house was listed had been listed too high and too long and was dropping slowly. Once he saw our deal he dropped his price immediately by a substantial amount and it will now sell. My point? We all know about people who think there house is worth more than it is, because they put in on the MLS. But there are lots of people who don't know the value of their homes, or think their homes are worth less, and these people might respond to you, and there's no guarantee that they'll all have doghouses. YOu could get a good one.

Another neighbor put his house on the market. I'm certain that he was thinking, as we had been, that the hit he'd have to take was larger than it really had to be. It was a very, very nice house. People like that neighbor and me, highly mobile individuals who seek stable neighborhoods but leave them more often than others do, would be very receptive to your idea.

I wish I had seen your ad! I could have saved the realtor commission. In a money-losing situation like I was in, it would have been nice to lose less.

Just so you know what type of neighborhood I'm talking about: Built in the early 70's, all the homes kept up, remodeled, updated, very leafy, long tenure, A-rated schools, selling no more than 420k in 2005/6, selling for 15 to 20% less now, very few sales since 2007.

    Bookmark   June 6, 2011 at 6:12PM
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jane__ny

Realestate guy, there are condo's which have been on the market for over 3 years, one has been on 5 years with no price reduction!...what is that about? Another has been on 2 years and they just raised their price $10,000 and now are trying to rent it.

My agent said many people are trying to cover their mortgage and can't afford to drop the price.

I'm going to wait until the end of June and then begin to make offers if prices are the same. I wonder when people begin to realize they can't sell their property at their price-point.

Jane

    Bookmark   June 6, 2011 at 11:53PM
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ncrealestateguy

Jane,
Those people who have their homes overpriced are the same as "Looky - Loos". Just like Looky - Loos waste everyone's time by never buying, these sellers will never sell, unless they come around.
Your agent is right, in that some people price the home so that the sellers just break even at closing... not a good way to price a home. I do not take listings like these.
Jane wrote: "I'm going to wait until the end of June and then begin to make offers if prices are the same. I wonder when people begin to realize they can't sell their property at their price-point."
As soon as you throw them an offer for a fair market price.

    Bookmark   June 7, 2011 at 7:31AM
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pamghatten

Different question ...

Sounds like this will not be your "forever" home? Then why do you "have to LOVE it"? My second house was a home I knew I would be in for 5 to 7 years. I didn't LOVE it, but I liked it, it was in a decent neighborhood, and I knew I could sell it when I wanted my next home (which turned out to be my forever home).

So maybe your standards are too high for a home you don't plan on living in forever?

    Bookmark   June 8, 2011 at 12:24PM
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