Home Buying Advice - Determining Your Offer Price
How to use market information to come up with a offer price for the home you want to buy
Determining Your Offer Price
So you have found the home you want buy, but what do you offer. You know the listing price but there are certain steps you should take in order to come up with the actual amount you want to offer.
The first thing your Realtor should do is perform a CMA or comparative market analysis. This process looks at recent sales of similar homes in the area and based on this information comes up with an approximate value.
Once you have this figure there are other criteria that should be applied in order to come up with your offer amount:
- Upgrades / Improvements.If the home recently updated the kitchen / bathroom etc these upgrades need to be taken into account.
- Condition of the home compared to the other homes used to determine the CMA value.
- Market Conditions. In a hot market you probably don't want to try and low ball the seller, but in a slow market you may want to offer below the asking price.