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How much info do we share?

Posted by homeagain (My Page) on
Sat, Mar 12, 11 at 14:31

We've been on the market since May 2010. Missed last spring's busy season. We've had 5 showings. We're priced in the upper 6 figures. We want to build a home better suited to our current lifestyle, but we don't HAVE to sell. Our listing expires next month and we are not renewing.

We had an offer at Christmas 25% below our asking price. We declined the offer. The same buyers looked at the home last week and are ready to make another offer. Our agent has asked what is the absolute lowest we will take for our house because the buyers don't want to waste time. They have not made a written offer this time. We don't really have a lowest price we will take and feel it's kind of strange that she would ask that. Actually the house is pretty much listed at the lowest price we would consider taking, isn't that the point? I emailed her yesterday and told her that we would not do that and they need to make a formal offer. The realtor emailed back today and asked how much me have invested in the home. I have not responded.
Is this normal?

We are the lowest priced of only two homes on the market in our 5 year old neighborhood. The last few homes to sell have been short sales and foreclosures, so they sold lower than we are asking. I realize in the current market that we have to make some concessions in order to sell, but we aren't going to "give" our house away.


Follow-Up Postings:

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RE: How much info do we share?

Curious, why is your agent asking the question. I agree, with you and tell them nothing except have their agent make a written request to your agent and at that time you will consider the offer. Sounds like your agent is trying to play games so you will either renew the contract or sell it at anything so she will get the commission. What has she done to help you out? I have never hear a agent asking how much you have invested. Just be alert and careful.


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RE: How much info do we share?

Thank you Marie! We've sold 5 homes due to DH's transfers over the years but never in a market like this. We've always sold quickly and with multiple offers. I had stupidly thought that since we live in a desirable neighborhood that the short sales and foreclosures of the few builder homes left wouldn't hurt but I guess I was wrong. There isn't many people looking in this price range and when their last offer came in so low I realized that I just didn't have the patience to deal with this kind of market which is why we aren't renewing.

I'm glad to hear that you think it's a little strange also....


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RE: How much info do we share?

If you really want to sell, have you thought of making a reverse offer? We were considering doing this with the couple who kept coming back and coming back to our house, but didn't make an offer (they finally ended up making an offer and we sold to them so we didn't need to do the reverse offer, but we were prepared to.) A reverse offer is pretty much your rock bottom price, take it or leave it. FWIW, it DOES sound like they are very intersted in your house, but they want to get the very lowest price they can. We almost threw in the towel and gave up since we didn't have to move either, but we finally realized that the money we thought we were losing on the sale would be way more than made up on the other side (we got an amazing deal on a custom build lot.)


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RE: How much info do we share?

"Sounds like your agent is trying to play games so you will either renew the contract or sell it at anything so she will get the commission."

That is exactly what I thought. It isn't any of the realtors business what you have spent or what your bottom price is. Her job is to ask buyer's what THEY are willing to pay, not what you are willing to settle for. If she were truly representing you she wouldn't be asking you questions like these.

I just bought a house after looking for years. I can't count how many seller's agents I ran into that told me far more about the seller's than I'm sure they would have been comfortable revealing.

One told me the seller's were getting a divorce even though they had said they were moving because of a job transfer. Another agent told me the seller's were going bankrupt because they couldn't make the payments even after the seller's told me they were moving to be closer to elderly relatives.

This type of info gave me a clear edge in negotiating.

So much for agents watching out for their client...

If you hire another realtor, tell them absolutely nothing except what they need to know, because they can and WILL reveal your hand.


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RE: How much info do we share?

I don't know where you've been buying and selling houses but in my experience there's usually a huge difference in what a homeowner has their house up for sale for and what the bottom line is they are willing to take. The fact that you don't know what your rock bottom number is tells me you haven't done your homework. You relied on someone else's guessimate of what your house is worth and aren't really serious about selling.
Do you have any idea what the comps in your area are? OR how those foreclosed or short sale houses are going to affect your bottom line? Have you asked your agent those questions?
When the bank goes to lend these buyers money and they start looking for comps they will use houses old within the last year to the last 6 month, depends on the bank and area. If those foreclosures or short sales show up as comps to your house it's going to throw everything off.


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RE: How much info do we share?

"I don't know where you've been buying and selling houses but in my experience there's usually a huge difference in what a homeowner has their house up for sale for and what the bottom line is they are willing to take.

The fact that you don't know what your rock bottom number is tells me you haven't done your homework. You relied on someone else's guessimate of what your house is worth and aren't really serious about selling."

The OP said "the house is pretty much listed at the lowest price we would consider taking".

Perhaps you would care to explain how the OP stands to benefit by revealing their final 'rock bottom' price to a buyer who has yet to make a 'serious' (formal) offer.


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RE: How much info do we share?

I don't think that the seller needs to reveal the rock bottom number and I think how much the seller has in the house is relevant.

That said...it does seem a little unusual that the seller is listing the house at a rock bottom number with no wiggle room at all. We recently put our house back on the market considerably below where we were at last year. We kept it off for a few months then relisted at a number I never would have thought a year ago that I would ever list at. We had very little wiggle room in that number but still had a little (we are under contract within 3 days for just a little under listing price).

The most telling part of the original post is that they had 5 showings in 10 months. Even when we were priced at our highest we had many, many more showings in a shorter period of time.

5 showings in 10 months says the house is overpriced. Period. The OP may not be willing to sell for what the market value of the house is and if the OP doesn't have to then I agree taking it off the market is the best thing.


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RE: How much info do we share?

Well, I have to agree that 5 showings in 10 months is a red flag. It sounds like you have been with the same realtor the whole time? If that is true, may I ask why?

I'm not certain why you have so few showings. As pointed out by kats_meow, you might be overpriced. But if you are, your realtor is at least as much to blame for that as you. She has had since May to gauge where your market really is, and she should be the one advising you as to where you need to be on price.

(Unless she has, and you are not listening? I know it is unlikely, but it is possible to hear only what we want, just tossing out a thought.)

If that is not it, I would consider trying a different realtor. They are not all created equal. 5 showings in 3 months is not great, let alone 10...

I am perplexed though, as to why these buyers are back again after 2.5 months? if you are overpriced, they seem awfully fixated on your home. That is a possibility of course, people buy homes for very different reasons of taste. But it seems to me that if they thought they had better options they would pursue them.


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RE: How much info do we share?

Its interesting to see how "sellers" view things. As an agent, I do understand "SOME" of your agents questions, but not all. But from what you said, they made an offer 25% lower than your asking price and it doesnt sound like you made a counter offer? The buyer walked probably thinking you would come to your senses in a few months. (typical of most buyers right now) and you felt I'm not going to give my house away (typical of most sellers right now). Ask your agent to ask them to submit their best offer and see if you can work it out from there.

I see nothing wrong with their request. If you had a bottom line in mind, it would be the easiest way to cut to the chase. "My bottom line is such and such", the buyer either knows he is willing to pay it or hes not. There is no reason to waste another few months waiting for you to reduce your price again. You both get what you want and can get to the business of getting your house sold.

As for your other comment Actually the house is pretty much listed at the lowest price we would consider taking, isn't that the point

No, most buyers expect to negotiate on your asking price, especially in a buyers market.


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RE: How much info do we share?

It seems to me that if the buyers are serious and want the house, they will get an offer in and get under contract.

A lot of price adjustment will come about with the home inspection & even more important for the price is the appraisal. So by stating the "lowest price" at the beginning of the process seems to be putting the seller in a weaker position.

Good luck
Susan


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RE: How much info do we share?

Well, where to start??

Our agent was actually an agent for the developer 6 years ago when we were looking for a lot. We used her to purchase the lot and find a builder and she represented us with the build of this home. We remained friendly and she now works for a different agency and was a natural choice for us when we decided to sell.

With our oldest now in college we decided that now might be a good time to downsize and met with her in the winter of 2009 to talk about our plans. The price we have our home listed at is the price she suggested in our meeting then. We then met with builders to price a custom home for us and the figures we were receiving back for the new home made the price she had suggested workable if we didn't come down more than 3% in negotiations.

By the time we had received 4 bids for the new home, DH's company announced they were cutting 100's of jobs and we decided to wait until the layoff's were announced to make a decision. Hence the May listing date at the price suggested in November of the previous year. A price she did not suggest needed amending.

Now as to the previous homes we have sold.... in 1992 we sold a home listed at $53,500 for $54,500 the first week it was on the market. In 1994 we sold a home listed at $114,000 for $107,500 after 6 months on the market. In 1998 we sold a home for $188,000 that was listed for $189,000 after three weeks on the market. In 2001, we sold a home listed at $269,000 for $265,000 after three weeks on the market. And in 2005 we sold a home listed at $429,000 for $395,000 after 4 months on the market. Therefore, as you can see there has never been what I consider a HUGE difference in any of these home sells. The whole idea is to get as many people in as possible so why list at more than you want and miss out on buyers?

As far as no wiggle room, one of the reasons we are doing this is to cut both the size of our home and the size of our mortgage. We only feel it is worthwhile if we can get a conventional loan and get rid of the jumbo we currently have, therefore we need within 3% of list price to do that.

Overpriced? As I've said we're listed in the higher 6 figures and not many people are looking at homes in this price range. Our neighbor, who sold last year, was on the market for 1.5 years and only had 5 showings. Of the 5 showings we've had, one couple said it was pricey. They looked at all three homes for sale at the time in our neighborhood and then bought in a neighborhood where homes are half the price. One couple were trying to convince their grown son to move back to the area and spent their days looking for the perfect house to convince him. Two loved the home but didn't like the neighborhood. And then we have our buyers who will be first time homeowners whose parents are purchasing the house for them. The listing agent also had two realtors lunches in the home and none said they felt the home was overpriced.

We actually did counter their previous offer but only by coming down a token amount (a few thousand) as suggested by our realtor. We didn't hear from them again until last week. Our realtor states that they have looked at two other of her listings in the intervening 2.5 months, one priced the same as ours and one priced over a mil.

Since we've been on the market one builders new construction home has sold after foreclosure for $500,000 less than he was asking. Asking price was 1.2 million. Sold price was $725,000. One other home that was listed at the same price as ours recently sold in a short sale but the price has not been revealed yet.

Our realtor has said that these will hurt our chances at appraisal but had not said we should lower the price, maybe because we told her in the beginning that there was no wiggle room.

My thoughts are... here is a young couple looking to take advantage of the recession by purchasing a home for much less than it's value. The fact that we've had these foreclosures/short sells in our neighborhood affect how much I can sell my home for. However, my home is not a foreclosure or a short sell and I am not willing to sell it for a price as though it is. So yes it is better for the listing to expire.

Now the two questions remain. Is it normal for our realtor to ask us to disclose our bottom line to the buyers or to disclose the amount of the investment we have in the home?

It looks as though the answer is more in favor of no, these aren't really something we should share.


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RE: How much info do we share?

Is it "normal" no. You've been on the market for almost a year. Its a means to an end. You dont say where you are, but in most areas of the country, "higher end" homes are selling, "lower end" homes are selling, and everything in the middle is sitting.

The bottom line is, your agent is trying to get your house sold. If you want to give them your bottom line to see if there is a possibility of a meeting of the minds, do it. They will either accept it or walk away.

If you're not comfortable with that, tell your agent to tell them to make their best offer and you will see if you are interested.

Asking about the bottom line is more common than most think in difficult negotiations or with people that just dont want to negotiate. I'm still not understanding the amount of investment in the home unless your purchase price is public knowledge and they are trying to figure out what on top of your purchase price you have in the home to possibly see what number you are looking to hit. (the only reason I can think of that your agent is asking is to try to justify the price to them if comps arent enough)

I will tell you that when your listing expires, every agent that comes in there will want you to start out at a lower price then where you are at now. If you start at the same price, you will have the same result, few showings in 10 months on the market. Do what you can to see if you can come to an agreement with this offer. USUALLY, your first offer is your best offer.


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RE: How much info do we share?

You shouldn't provide any additional financial info to your realtor. It's just more negotiating fuel for the buyer. The realtor is just trying to clinch the sale by playing both sides. Find out your bottom line, reveal it to the buyers and get the contract.

That being said, your potential buyers may come back at you with an even lower number. They may think you are more desperate to sell because of the lack of offers.

How badly do you want to sell the house? Like or not, the foreclosures and short sales in your neighborhood are comps and are going to negatively influence the appraisal. If your house doesn't appraise, it will complicate your sale and maybe even kill it, depending on your contract.

If you REALLY want to sell the house, you are going to have to drop your price. Your realtor isn't suggesting it because she doesn't want to loose the listing.

It sounds like your realtor is just looking out for herself. I suggest you drop her once the listing agreement expires.


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RE: How much info do we share?

Have to agree with the other posters...don't answer your realtor's questions. Those are questions a seller should not let a buyer know. She is only looking out for herself and doesn't want to loose a commission. There is not a doubt in my mind that she would use that info in favor of the buyer. Dump her after the contract expires. As you stated you don't have to sell yet. NancyLouise


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RE: How much info do we share?

As a seller, I/we have always let the buyer know our bottom line, in writing. Sounds like some people here want to play games.
As to the investment part. We always add landscaping, granite, wood floors, fencing, A/C etc., which adds tens of thousands to the value, or sets us apart from the competition when the time comes to sell. Maybe that was the information they were looking for?


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RE: How much info do we share?

Our purchase price is a matter of public information. However, it doesn't take into account the amounts that we paid the builder out of pocket for items we exceeded the allowance on. Nor does it reflect the 1500 square foot finished walk out basement with heated travertine tile floors, cherry bar with granite counters and built in wine and beverage fridges, the home theater etc. It doesn't included the extended ipe deck with built in hot tub, etc. So the purchase price is nowhere near what we will have invested in the home.

DH is refusing to share either numbers, so we're just going to let the listing expire unless they come to us with an actual bid.


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RE: How much info do we share?

What tyou ant (or "have invested") has little to do with the market value.

Wat have comparable homes gone for in the past 3-6 months?

You can adjust slightly for differences, but be very careful what value you assign.
What you paid is NOT normally the value, it is usually LESS.

'Upgrades' you put in are now used, not new.

If they are not to a buyer's liking their value is ZERO to that buyer.

You never want to be the most expensive house in a neighborhood.

It makes sale and appraisals that much harder.


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RE: How much info do we share?

It seems to me that the important figure in this scenario is going to be the appraisal. Has your agent given you a realistic amount to expect from the appraisal--based on his/her knowledge of the local practices. Are you willing to sell the house for that amount? If not, are you willing to wait for a better housing market?
If there is a young couple with their eyes on your house (and they seem to be patient, waiting for the house priced at the lowest), I would explore the appraisal situation to see if you really want to sell it now or not.

Good luck
Susan


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RE: How much info do we share?

"I realize in the current market that we have to make some concessions in order to sell, but we aren't going to 'give' our house away."

LOL that people are still using this phrase in 2011. I would have thought that after 2008, 2009, and 2010, people would know better.

BTW, what makes you think someone would pay more for a house simply because you're selling it rather than a bank? And on the off chance that you find someone willing to pay you your asking price, lots of luck at getting it appraised at a price higher than all of the other recent sales.

Sorry to be so blunt, but after a year and a half, it appears that you needed some ice cold water of reality splashed on your face.


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RE: How much info do we share?

It seems to me that they want your home; we paid more than we wanted for a certain home in the past, because it had everything we wanted and it was way more appealing than other homes we had looked at, and we knew the sellers would not budge and there was no other home that interested us.

If I were you, I would state my bottom line and be realistic about the number.


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RE: How much info do we share?

Although many people here responding are correct that asking for your bottom line is NOT the norm, we just had to do that very thing last week. We've sold our house and have to have house to move to by the end of next month. We simply didn't have time to waste going back and forth with counteroffers, etc. We needed to know a sellers bottom line to know whether to proceed or not, without letting other homes available get away in the process. In our situation, the seller was more than happy to verbally give our realtor his bottom line, in hopes of selling his house. Also, our house was listed in the fall and we had just five showings, too. We took it off the market at the end of Dec. and just relisted it, dropping the price. We figured the five showings indicated it was overpriced. In the first weekend we showed the house 7 times and got our offer. (Our house is also priced in the high six figures.) No, it's not the price we would have hoped for in 2009, but it is the price that reflects today's market. We're happy to have sold and just want to get settled in our new house! Good luck to you.


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RE: How much info do we share?

Selling Homes 101 says that the market doesn't care what you "need" from a house sale and if you price it too high, then you're simply not going to sell until you reduce that price to below market value. You have only had 5 showings (which indicates that you are very overpriced for your market) and say you don't know what your bottom line is. You aren't at all serious about selling your house.

You're floating trial balloons to see if anyone falls in love and loses their head enough to overpay for it. You're wasting you and your agent's time.

Your potential buyers are serious about buying your house, and they are signalling to see if you now have a new understanding of it's market value. Not disclosing your bottom line to your own realtor greatly hampers any back and forth discussion that the realtor might have with an offering realtor.

Don't you think that your realtor would rather get commission on a larger sale than a less expensive sale---IF that was possible? They don't want to drop to your bottom line price either, unless that's the ONLY way to ensure a sale---which you presumably actually want. And you're being overly paranoid about sharing a legitimate piece of the puzzle that they need in order to do their job.

That 25% below your listing price is probably pretty close to current market value, and if you aren't willing to take that or anything close to that, then pull the home off of the market and wait 5-7 years until the market price reaches your desired number. And spend 5-7 years worth of carrying costs and "newness depreciation" as well. If you add all of that up, that's a much higher number than actually accepting a lower price on your house.


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RE: How much info do we share?

When the agent asked how much you have invested in the house I would ask why she is asking. In the past I've had an agent want to know about upgrades, etc. that I put into the house and they make that part of the marketing/discussion with the other real estate agent. So if it is being asked to show that you did a lot of upgrades, etc. beyond the base price for the house (which is public knowledge) then that seems reasonable.

If your bottom line is 97% of your asking price then I don't see a big problem with you making that as a final offer. It may be that you can't afford to sell your house for less than that but that the current market value is less than what you want. If that is the case, then you are better off at pulling it off the market. We recently listed our house and really tried to list it for a price that would make it attractive and sell fast and get it into a lower price bracket (our house is higher end for our area). We knew in doing that we wouldn't have much wiggle room to reduce our price since we were already reducing it so much to try to have a quick sale. But, we ended up with 4 showings in 2 days and accepted a contract very close to our listing price. (And, yes, higher end houses do tend to have fewer showings but often it is because they are overpriced for the market).

In your case, it may be that to get to that point where you can sell your house for close to your listing price that you will have to reduce the price below what you have to have to be able to sell the house. We priced our house way below what I had ever wanted to price it at, but I looked carefully at the cost of keeping it until the market was better and it came out better economically to sell it now for less.


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RE: How much info do we share?

WOW! Sellers in this market that refuse to counter the first offer and then refuse to even get into a dialogue with good buyers the second time around. The poster is understasting when she says that they are not motivated to sell.
Katsmeow's above post is right on... the buyers are asking for the sellers to give them ANY reason to justify the asking price. They want the home, but need some assurance that it is worth something close to asking price.
Posters, face the facts... you will have to "give it away" if you want to sell. All you have to do to sell is realize this fact, and get over it. Everyone is in the same boat. Your home is not any more special nor unique than the other hundreds out there trying to sell.


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RE: How much info do we share?

you will have to "give it away" if you want to sell.

But they don't want to sell if they have to "give it away." What's so wrong with that? The OP said in her fourth sentence, "but we don't HAVE to sell." That is 100% her prerogative.

Her question had nothing to do with this bashing tangent.


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RE: How much info do we share?

kellyeng .. totally agree ...

"Her question had nothing to do with this bashing tangent."


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RE: How much info do we share?

kellyeng & pamghatten. Thank you both so much! I've just been reading through these posts asking what do these responses have to do with my question and you both have said it for me!!

The title of this thread is not "is my house overpriced?" It may very well be...but I didn't request a comment on that.

We are extremely lucky that we don't have to sell in this market and will be remedying that soon.

The only questions I asked in this post was is it "normal" for our realtor to ask us our bottom line to pass on to the potential buyers or to ask how much we have invested in the home.

Thank you to those who answered my questions. You have helped me to understand some reasons she may have asked.


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RE: How much info do we share?

"The title of this thread is not "is my house overpriced?" It may very well be...but I didn't request a comment on that. "

The in of you might need to share to justify a higher price gets sort of touchy.

Even if the buyer is willing to pay, the appraiser may not think the place is worth the selling price.

You are seeing the classic signs of a place that is likely overpriced, and are going to have to deal with a lot of extra questions.

If you do not need to sell you might want to stop wasting everyone time and wait for the market to improve.

Bad markets attract bargain hunters and bottom feeders.
I know because I make a lot of money on the lower prices and forced sales.

Your house is viewed relative to the other houses for sale in the neighborhood, and relative to the other completed sales (not asking prices) by the appraiser.

If either party thinks something is high they will ask questions.

The appraiser is harder to satisfy usually.
They are interested in what they can quickly sell the place for in a foreclosure, and not a lot else.
Things you may value can even be a detriment to a fast sale (like a swimming pool in an area that has few household pools).


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RE: How much info do we share?

"LOL that people are still using this phrase in 2011. I would have thought that after 2008, 2009, and 2010, people would know better.
BTW, what makes you think someone would pay more for a house simply because you're selling it rather than a bank? And on the off chance that you find someone willing to pay you your asking price, lots of luck at getting it appraised at a price higher than all of the other recent sales.
Sorry to be so blunt, but after a year and a half, it appears that you needed some ice cold water of reality splashed on your face."

bethesdamadman-You said you bought a house in Las Vegas not that long ago. You were pleased about what a good deal you got on it. Any idea what you could sell it for today? Especially since the market out there is as bad as its ever been? Bet more than a few homeowners out there could use a cool drink of ice water while reading the latest appraisals.


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RE: How much info do we share?

Beat a dead horse much?


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