Monday, December 29, 2008

One Last Attempt in 2008

A new home, we had our eye on last summer, fell out of escrow this month. It is priced competitively, given current interest rates, as is the other local development we had our eye on (even with all the extra monthly fees and taxes). It was a bit of a difficult decision, but we figured we would go with the higher priced home since it best meets our needs.

So we put in our first offer on a new home in a development (last year's offer to a builder was not in a new home development, it was more of a one off type deal). Our offer was only 5% below asking, so I don't feel we are being unreasonable. After all, they already received a 5k deposit on it from the previous buyers, and if we had come in with our realtor the first time we visited, they would have given him 5k as well.

So now we wait.

(The part that was most disconcerting about this offer process was, they didn't care/ask or want any documentation about the financing, like what our credit is, or if we have any money down etc., all they really wanted to know what what price we were putting an offer in at.)


alba said...

I'd ask you for a urine sample! To make sure you weren't on drugs. (I just read the comments of the SacBee article). Nice job!

alba said...

At this point, you have to expect the stimulus package to contain incentives for buying homes; even more for new homes. Real tax rebates are just around the corner also.

Additionally, I would expect additional pressure/stimulus for lowering the interest rate even further.

Have some patience!

Husmanen said...

I have seen some downward movement on select new home prices in EDH.

But not too far away, Elliot in Folsom is not budging much, but they seem to sell a few homes now and then.

As home prices get closer to my rent/own ratio I am more tempted to formalize my offers/discussions. Some of my formal offers from the beginning of 2008 still could make sense, others not.

At the same time a hit to the rental market will throw off my numbers and 'reset' my perspective.

Wish you the best...

Buying Time said...

Normally we have more patience...not like a couple more months would kill us, after waiting for over 2 years. However this is the last home in the development with the floor plan we like, and a reasonable sized lot.

Of course they will likely counter. I'm not sure I would feel comfortable going any higher. Its a fairly new development, so even though foreclosures are pretty rare right now, they are likely to increase in the next two years, which will quickly bring down the value of our home.

Buying Time said...

And you are right Husmanen, we don't even bother to look at, or call on Elliot Homes any more.

This offer doesn't quite make us whole on the rent/buy, but it's not too far off either, and I love the home (wouldn't change a thing, but add some color to the walls...of course there is still the backyard landscaping to do).

Ed said...

Hey BT - What are your plans for taking care of that Realtor you've been working with all this time? Does he/she get anything for all the effort?

Buying Time said...

I guess we will have to cross that bridge if we get to it. He has taken us to see homes twice this year, and we have put in several offers with him. Not to get into too much detail, but we have given him all the clothes my son has outgrown for the last two years...I joke around that it's his retainer since it is taking us so bloody long to find a home =)

Unfortunately, the builder would not honor our relationship with him since he did not come with us the first time we visited. I believe this is standard industry practice, but it seems some are more willing to bend the rules than others. We did our best to fill out the cards when we first visited a development with his info.

patient renter said...

the builder would not honor our relationship with him since he did not come with us the first time we visited. I believe this is standard industry practice

This seems sheisty to me. The builder is the industry, and the practice is whatever they make it. They probably just don't want to make an allowance, which is not very nice.

Mike said...

"But not too far away, Elliot in Folsom is not budging much, but they seem to sell a few homes now and then."

I remember visiting Elliot Development in Folsom about an year ago. They wanted 1,300 sq ft home for over $400K. I said was there any incentives and they said no. No haggling in price or upgrades. I laughed and walked out and never visited them again. With all the forclosure and other home builders willing to deal, they still did not budge in their pricing. I would be very surprised if they sold many homes over there.

Husmanen said...

Mike... my favorite incentive Elliot offers is the Zero Percent Interest Loan - Own Your Home in Five Years. Basically, you pay a monthly payment based the advertised price divided by 60 months.

WOW! Now that is a deal - HA! If I had over $400k cash laying around I would not put it into a depreciating asset in an economy where cash is king.

Maybe someone can help me out with the logic here.

alba said...

You guys have been very patient, and will be rewarded...but there are a few tangibles on the way for waiting just a little longer.

Happy New Year!