patrick.net

If it makes you that upset don't buy it. There is low inventory in the Bay Area right now so you have to do whatever a realtor tells you. You should be grateful just have the opportunity to bid on this place. Just think if it went up 150k last year it will probably do it again next year. What do you have to loose? It's not like Bay Area price can go down.

Call it Crazy says

evilmonkeyboy says

Just think if it went up 150k last year it will probably do it again next year.

What if it goes down next year or flatlines if rates keep going up??

p=1230911&c=1016156#comment-1016156">evilmonkeyboy says

I was thinking he had to have been sarcastic. I don't think it makes an ounce of sense that it would go up again like that. I am not totally convinced that it did go up like that in the past year.

We are going to sit tight if at all possible for 10 years. That is part of why we are looking at buying. The equation looks different when you extend the time you are going to be there.

We are selling my Mom's house in Texas right now. She has been there for 50 years. It puts the length of ownership in a bit of perspective. We would love to stay somewhere 30 or 40 years. I think we are too old to make it to 50 years :-)

evilmonkeyboy says

If it makes you that upset don't buy it.

I didn't mean to convey that we are upset. I am just saying that it is an absurd time in real-estate. I have to put a lot of thought into this as it is a huge purchase. I am just looking for some informed opinions about these pieces of information that don't totally add up for me.

Yes it's absurd. What seems so wrong is how enticing it is to see subdivision like streets with houses that look like they should be reasonably priced for the average resident who makes a good income, has a decent down payment.

The problem is the population of buyers within the confines of the space they want to live in that idyllic subdivision lifestyle is so extremely out of whack with the supply. We would never ask this question in other high population high priced areas like Manhattan, Beijing and the like. The only "house" you can buy in those cities is an apartment, maybe. As long as the bay area continues to look like a subdivision the more upset it will make you feel when what you want is so out of reach!

mjfhorsey says

As long as the bay area continues to look like a subdivision the more upset it will make you feel when what you want is so out of reach!

For us the question is, "How far should we stretch, if at all?" We are approved for more than the asking price. I just don't want to pay more than I have to.

The realtor we are working with is saying that it puts her in a difficult professional situation if we come back low after she convinced them to counter at all. It sounds like BS. I think she sees her job as needing to make sure it closes so that she gets paid. I don't think making sure that we don't pay more than we have to pay is on her list of things that are "her job". Maybe this is why people get so mad about realtors. I don't know.

bg says

The realtor we are working with is saying that it puts her in a difficult professional situation if we come back low after she convinced them to counter at all. It sounds like BS.

She is a professional so I am sure that she is putting your interest above her own personal gain.

bg says

What are the chances she is telling the truth about 650K?

how else do you think we got into this bubble... and to think these home

were no more than 250K not all that long ago...

bg says

he just needs our bid to be the best bid so that she gets paid.

there is a myth going around only high tech SW engineers make big money....

it doesnt take much to see 6% off the top on $650K several times a year

far out earns anyone elses income. Just 3 deals a year and they make 100K easy.

Call it Crazy says

The current housing market is the most dis-functional, screwed up in my decades of experience!!!!!!!!!

and in heavy denial to all the horrible practices going against any buyer...

Call it Crazy says

Your catching on to the "game"... At the end of the day, they work on commission, so no sale, no dollars to them.... Always remember that, no matter how sincere they seem...

She doesn't even seem that sincere to me. The whole business about her professional reputation in the city as being part of why they even bothered to counter. That just straight-up rubs me the wrong way. My offer price should be about me, not her. Smells bad. Feels manipulative.

I think the fact that we offered them money is why they countered. They thought that they could get more. I suspect they didn't have anything else and that was why they countered.

I know it has been a hot market, but I think it is cooling off.

how to bid? Lower & lower & lower

OPpHEY YOU says

how to bid? Lower & lower & lower

... with bags of post 1982 pennies.

3k in termite damage?, run, they are selling the place because it's junk, not surprised they did not put any lipstick on it - I'm seeing more and more of these .. unprofessional flippers. They know we've hit the turning point where remediation is not paying, either that .. or the stupid point where people just don't care.

But .. man, if you got piles of money, and the location is great, hell who cares, just hire contractors to fix it/rebuild it.

Here is my two cents. Since no real work was done on the house since the last sale, the owner bought with the hope of flipping, which is exactly what he is doing right now. Since the market is hot, he intends on getting top dollar (or more) and doing nothing to the house. With the termite damage it's a suckers bet and you're being played as the sucker. For me to pay that much for a house it had better be 10,000 sq ft or more, it better come with a pool, a tennis court, a sauna, a Jacuzzi, have 5 bedrooms and 5 baths on my 10 acre plot and the hired in help (maid, cook, gardener, chauffeur) had better come with it. But what do I know, I live in Texas and chances are my house (which costs less that $120K) is bigger, probably newer and certainly doesn't have the termite problem.

everything says

But .. man, if you got piles of money, and the location is great, hell who cares, just hire contractors to fix it/rebuild it.

No piles of money here. They did agree to fix the damage it we paid 725, which is a crazy town price.

I did a lot of reading and thinking last night. I think we are not going to do what the realtor suggests. The more I read, I think that it seems to clear that things have cooled off. We are perfectly content where we are, so there is n reason to stretch. There are plenty of other houses built since 1990 in this town. We will either find another one down the road that we like, or we won't.

It was $2,200 a month difference between our costs here and our costs there. That is a lot of saving that I can do while we see what happens.

It also turns out that I was reminded of something about myself. I learned this back when I was dating and when I have bought cars. Try to push me and I will just walk away. I have had to explicitly tell car sales people if they ask me, "What would it take to get you in this car today?", I will walk out and not come back.

So the Realtor really helped me put this in perspective when she said she was worried how our low bid would reflect on her reputation as a realtor. I think it was pretty much done at that point, it just took me a few hours to appreciate it. To me, that was some heavy handed manipulation. Money is green. Business is business. Say "no" or counter if you don't like the offer. Being angry, hurt or insulted is more crazy town in my book.

Will post about how things turn out.

mmmarvel says

But what do I know, I live in Texas and chances are my house (which costs less that $120K) is bigger, probably newer and certainly doesn't have the termite problem.

Part of the challenge for me buying a house in CA is that I also grew up in Texas. I can get my mind around paying 500-600k here for something that might be 150-350k in Texas (depending on the neighborhood or city) since the weather is so nice here.

That said, I am not going to be the top of the bubble buyer. I think that is what this seller is looking for.

egads101 says

offer what you are willing to offer, and that is that. What is sold for a year ago is not your consider, unless you have a good idea for a time machine! Today's market is today's market.

So, offer the price you would be ok with paying for it, but you need to be prepared to be ok not buying, and watching it sell to someone else if you don't get it.

Exactly. Past or future is not a concern so long can pay mortgage.

bg says

The disclosure lists some electrical issues, some drainage issues and about 3k in termite damage.

One thing here stands out that doesn't make sense to me.
If termite damage is only 3k why doesn't he fix it himself? That's not expensive, and this is a very expensive house. One never sells expensive items with missing doornobs. You aren't going to go to a Ferrarri dealership and the sales guy will tell you to spend $200 to fix door handles after you buy...

This makes me think there is a lot more damage to it that he is not listing. If you are going to look, make sure nothing that is load bearing has termite damage... those fixes get very expensive (forget 3k, think 30k) because such often require a lot of support to be built in the process. Non load bearing is usually cheaper to fix.

Drainage - that's not cheap to fix. Old rusted out plumbing can be expensive unless you are on raised foundation.

Electrical issues...that's not a cheap ticket either. Good electricians cost a lot, bad electricians will burn your house down.

Otherwise if you think the house is too expensive, look for a better deal.

bg says

Part of the challenge for me buying a house in CA is that I also grew up in Texas. I can get my mind around paying 500-600k here for something that might be 150-350k in Texas (depending on the neighborhood or city) since the weather is so nice here.

You have to get past the price comparison. Big cities with good weather cost a lot, you pay a lot, but if you sell you get your money back.

But it never hurts to ask, if you like the place and think you can get it at a decent price, ask your agent to make an offer. You don't have to pay the sticker price, it doesn't cost you a dime to send an offer. Just make sure to send the offer you are interested in. No point of sending something you aren't willing to pay.

bg says

So the Realtor really helped me put this in perspective when she said she was worried how our low bid would reflect on her reputation as a realtor.

Look for another realtor. This one isn't representing you at all. As we used to say it back in the days, she is just jerking you around man.

bg says

The more I read, I think that it seems to clear that things have cooled off.

BG, we are entering the slower season. There's fewer houses offered, but usually the sellers are more motivated. so you might find a good place with less buying competition from now until around March.

And I agree with Ft Wayne. If you don't like this realtor, switch. Definitely some are sleazy, some are not smart, but there are good and honest ones too.

1) Find a good real estate agent, not one who has image problems about bidding low. You are making the bid, not the agent, she's a middle-man, like a lawyer. She can advise, but the decision is yours.

2) If you do make an offer, forget the seller's pipe dreams, make an offer that makes sense in this market, even if it's under asking. Add a generous inspection contingency, so that you don't have to trust the seller's disclosures. Bring in your own general inspector and termite inspector and have them go over the place with a fine tooth comb. This will cost you maybe $500 for the general inspection and ~$250 for the termite inspection, but if they tell you to walk away from the house, you've just saved yourself a fortune.

If the conditions above make the sale fall through, you move on and bid on another place. Don't get too attached to whatever you're bidding on so that you stay rational.

I recently bought a house, and you'd be surprised how much stuff costs.

- Install new electrical panel and run ground wires through the house - $6k
- Rebuild chimney to code since it's cracked from '89 quake: ~5k
- New plumbing since old galvanized is leaky? ~$15k+, since walls have to be chiseled open.

Never get real estate advice from a realtor.