UK Landlord Forum / Life

Have you ever been in such a circumstance? Or do you know of anyone who might have sold their property for a cheap cost due to one of the reasons below?

In this market, do you think it's ok to be patient when it comes to selling? Or should a sellers priority be to sell as soon as possible, hence compromise the initial selling price to accomodate whoever might be even slightly interested???!!!

QuoteTen Cheap Real Estate Motivators

■ Income Problems - Whether due to a lost job or declining business, a seller may no longer have the income necessary to keep his home or other real estate. He may need to sell fast to avoid further financial problems.

■ Negative Cash Flow - It doesn't make sense to lose money on real estate every month, so sellers with negative cash flow may drop the price to sell fast. Just be sure that you have a plan to increase that cash flow once you own the property.

■ Damage - This is one of the most common reasons for cheap real estate. The walls have holes, the roof needs replacing, and the cats peed all over the carpets. Fixer-uppers always sell for less, and the scarier they are the cheaper they get. But be sure you know what you are getting into.

■ Sudden Cash Requirements - Sometimes a seller has a better investment or other reasons to need cash fast. For example, selling fast might prevent him from losing another property to foreclosure, or it might mean getting into an investment that will make him far more profit than the little bit of equity he loses selling cheap to you.

■ Death - After the death of a loved one, family members may want to sell any real estate cheap to be quickly done with the bad memories, or to get their inheritance faster.

■ New Job - A job transfer or new job can give a person a lot of motivation to sell fast, and therefore sell cheap. Often, the seller will end up with two payments, and you will be helping by taking one off his hands.

■ Divorce - When people divorce, sometimes they need to sell to settle things, and the faster the sale, the sooner they get to be done with it all. Also, sometimes neither one can afford a home that was being paid for with two incomes. A fast sale prevents late payments and credit problems.

■ Behind in Payments - If a seller is already behind in payments, he or she is facing possible foreclosure. Selling to you at a discount is preferable to losing a lot more equity in a foreclosure.

■ Back Taxes - In most places an owner has to be more than a year behind on property taxes before he faces losing the property. If he is close the the deadline, however, you may get a deal. Just be sure you take into account the taxes that have to be paid.

■ Absentee Owner - It is difficult to deal with a property from a long distance, especially rental units. These sellers often get to the point where selling fast and regaining peace of mind is more important than getting full market value.

Other reasons when people sell below market value include sickness, partnerships gone bad, bad tenants, excess debt, and any number of changes in people's lives.

A vendor should be patient if they can afford to be. But if the vendor has debts to pay and interest rates are rising, it's probably worth cutting their losses and sell asap.

Of course, it ultimately depends on the individual case. For example, if a vendor knows that holding out for an offer closer to the value of the property will end up being more beneficial after subtracting the interest rate charges, it's probably worth getting into that extra bit of short-term debt.

Appreciate your input.

Agree pretty much with pfag.

It certainly doesn't make sense to drop the price you accept unless you feel you have to in a market like this, and its probably not fair to judge anyone on where they choose to draw that line - everyone's circumstances are different. So "should" is not as relevant a word as it otherwise might be.

That said, I'm not sure why anyone would accept less unless they truly believed it was the best offer they were likely to get, all things considered.


V

You missed one out, LOVE and FANTASY.

The last house I brought was off a desperate head over heals in love women who wanted a quick sale so she could be with her man.  I took the opportunity and brought for 18k under asking price,  May I add here that the relationship fell through 4 mths after I brought and she had spent all of her 40k capital on the dude and herself.
Hey ho there we go.

Good lord!



V

Quote from: Badger on November 13, 2007, 10:54:18 AM
You missed one out, LOVE and FANTASY.

The last house I brought was off a desperate head over heals in love women who wanted a quick sale so she could be with her man.  I took the opportunity and brought for 18k under asking price,  May I add here that the relationship fell through 4 mths after I brought and she had spent all of her 40k capital on the dude and herself.
Hey ho there we go.

A.k.a you prayed on the weak.

All the world is a market, and we are but market agents.


V