Finding Discounted Homes For Sale

Author: cameron  //  Category: Uncategorized

It’s not always enough to be up to snuff on negotiating that reduced price. Sometimes you need to know where to look to find a bargain that’s already available.

Redfin’s “Science of Real Estate” center studied the differences between homes that sold for a large discount and those that didn’t, and came up with guidance for buyers looking for large discounts.

“Homebuyers have begun crawling out of their bomb shelters hungry for big discounts off the asking price,” said Redfin CEO Glenn Kelman.

“Often, their expectations are unrealistic, as many sellers have already aggressively priced their homes. But when conditions are right, we’ve found that a small but significant number of sellers concede $50,000 or more at the negotiating table. We’ve tried to take the mystery out of when a seller will give ground and when she’ll stand firm,” Kelman said.

The recommendations aren’t negotiating tips but “where-to-look-for-bargains” tips.

Redfin says:

Look for languishing listings. Heavily discounted homes are 83 percent more likely to have been on the market for 90 days or more. Most sellers will hesitate to accept a low offer if the property has been on the market for only a few weeks.

Find fixer-uppers. Heavily discounted homes are 73 percent more likely to need some fixing up. People who sell homes before fixing them up are usually more concerned about speedy selling than peak price. Get the home inspected before you buy so you know exactly what needs work.

Retreat from remodels. Heavily discounted homes are 20 percent less likely to feature a noteworthy remodel. This also means sellers who sink money into major remodels before they list could be missing out on certain buyers.

Pick properties with pared prices. Homes that are already heavily discounted are 28 percent more likely to already have price reductions. Duh.

Hunt homes with long-time owners. Heavily discounted homes are 52 percent more likely to have been seller-owned for 20 years or more. The longer a seller has owned a property, the more equity he has likely accumulated, and the more likely he is to make significant price concessions.

Put your finger on a flip. On the other hand, heavily discounted homes are 9 percent more likely to have been owned for less than five years. A home owner or investor in trouble may be motivated by the need to quickly reclaim capital, rather than wait for equity growth.

Don’t bank on bigger bargains from bank-owned homes. Heavily discounted homes are 9 percent more likely to be a short sale or bank-owned. Banks lower prices as much as possible from the beginning to unload distressed properties as quickly as possible, but no so much to take more of a loss than is necessary.

Affordability Options For First-Time Buyers

Author: cameron  //  Category: Uncategorized

First-time home buyers who want affordable homes may want to take a hard look at fixer-uppers, smaller homes and cheaper commutes to work to save on the costs of buying and owning a home.


Real estate brokers say many home buyers expect more than they can afford in a home and once they start pounding the pavement for housing their disconnect could be discouraging.

In an online survey of 150 of its brokers, Coldwell Banker discovered some disturbing trends among first-time home buyers.

While nearly half of the Coldwell Banker brokers surveyed said affordability was the No. 1 concern for first time buyers, 81 percent of those buyers also consider move-in conditions to be very important when searching for homes. Only 7 percent are considering fixer-upper homes.

The real estate company suggests more buyers should examine the fixer-upper option — among others — to get the affordability they seek.

“In the past, first-time home buyers were willing to purchase older, more basic houses in an effort to save money and break into homeownership,” said Jim Gillespie, president and chief executive officer, Coldwell Banker Real Estate, LLC.

“It is important for first-time homebuyers to remember that by considering a fixer-upper for their first home purchase, they can build equity over time and later move up and into their second-stage home that better reflects their expectations,” he added.

Coldwell’s findings are inline with Redfin.com’s recent “Science of Real Estate” study of the differences between homes that sold for a large discount and those that didn’t.

Redfin found that heavily discounted homes were 73 percent more likely to need some fixing up than homes that weren’t discounted. According to Redfin, people who sell homes before fixing them up are usually more concerned about speedy selling than peak price.

Buyers looking for affordability who go with the fixer-upper option should get the home professionally inspected to determine what fixing up is necessary, and certainly not bite off more than they can chew. Even homes that need a basic face lift — paint, carpeting, landscaping, window treatments and other cosmetic touches — can come with big savings. Homes that may require professional upgrades cost even less, but the buyer has to weigh the discounted price against the cost of the improvement.

Coldwell’s study also found some disconnect between affordability desires and what buyers want in home size and its location.

The vast majority of first-time buyers, 71 percent, were looking for larger homes than they were 10 years ago, brokers reported, but bigger isn’t better when it comes to price. A smaller single-family home or a condo or townhome can be cheaper by virtue of the smaller footprint and square footage. The smaller cost on a smaller home also could come with affordability

Forty-one percent of brokers also said, for their buyers, proximity to their workplace was numero uno when it came to considerations made when looking for a home. Higher gasoline prices have made the job center location factor even more crucial, however, in most metros, a home’s proximity to employment centers comes with an added cost. Homes nearer job centers cost more because of the added value of reduced transportation costs and time (which is money) spent commuting.

However, buyers can enjoy the best of both worlds if they purchase a cheaper home away from job centers, but in a transit oriented development (TOD) or other distant community that offers low-cost public transit to work. Carpooling, trip sharing and car sharing communities boost the idea of affordable housing.

Coldwell Banker also said 46 percent of the survey respondents reported that first-time home buyers look at five to 10 homes, on average, before making a purchase.

The message is simple here. Spend more time looking at more homes for sale. Instead of five to 10, make it 10 to 20. Take the time to find affordability. The Redfin study also found that discounts were more likely available from homes that had been on the market for 90 days or more; homes for sale that were owned by long-time owners; homes for sale from flipping investors down on their luck; and properties owned by we-want-to-sell-real-estate banks who now know what it means to be careful what you wish for.