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Your Money: A Real Estate Deal Seen From 2 Sides

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moh malekpour

Elite Member
Joined
May 25, 2002
Professional Status
Certified Residential Appraiser
State
California
http://www.nytimes.com/2008/05/31/b...em&ex=1212379200&en=b0e102f041d0a49f&ei=5087
A few years ago, when multiple bidders would show up at a real estate open house, the truly desperate resorted to writing love letters to the sellers.

Their plaintive scribblings painted a picture of first-time buyers chasing the American dream or growing families hungry for more space. The letters dripped with compliments for the property and ended with a plea for mercy (and a signed contract).
Do you remember those days? they are gone now and this is today:
Today’s real estate market, however, calls for a different kind of letter, less a fuzzy valentine and more like a cold splash of water. It’s what you write to accompany a bid that is so far below the listing price that it cries out for explanation
Sample letters that buyers attach to the offers and sellers return them with counter offers these days are interesting. There are some market reality and market analysis by buyers and sellers in those canned letters which are worth of reading for appraisers.
This is the indication of housing market psychology of today that appraisers should be aware of.
 

Mike Boyd

Elite Member
Joined
Jan 18, 2002
Professional Status
Retired Appraiser
State
California
Any listing agent that would deliver such a letter to the owner would be out of his/her mind. The letter is not an offer, it is an attempt to intimidate the seller. However, the concept could be a good negotiating tool. I would mail it to the seller a few days before writing the offer. No agent participation.
 

Randolph Kinney

Elite Member
Joined
Apr 7, 2005
Professional Status
Retired Appraiser
State
North Carolina
The big hope for the seller is that the government is going to loosen the credit conditions where more buyers will qualify for loans, thereby increasing demand.

It is hard for these folks to realize that the pipeline is full of homes for sale and there is supply waiting to come onto the market to exceed any increase in demand.

At best, prices won't fall as fast. At worse, more foreclosures will flood the market driving prices down continuously.
 

NC Old Guy

Junior Member
Joined
Jan 16, 2002
Professional Status
Certified General Appraiser
State
North Carolina
I would rather see the letter written to the listing agent along the lines of "what were you thinking to allow such a high listing price". If many of them would ever stop & look to see what properties are selling for, and not just what other listing agents are listing the competetion for, perhaps the market might become more settled. Why oh why do they always assume their's is worth 5-10% more than what the others are listed for, when the sales are 5-10% less than what they are listed for.
 
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