Before Making an Offer
Buying Boston Area Real Estate
Time to Process is necessary after you have chosen the three homes you are most interested in. You should usually only offer on one property at a time. After you have made your comparisons and reviewed the Sellers' Statement of Property Condition you need to determine value.
What’s the property worth? This is a key question before ever making an offer on a property. Even if it seems like a sweet deal on the surface, don’t ignore the homework. Your Buyer’s Choice Agent will use important data to help determine value. You will then determine what you want to offer. Price analysis helps you determine how much to pay for a property. Pricing should include the following.
CMA stands for Comparative Market Analysis. How does each property compare to other properties of similar style, size and location? Your Buyer's Choice Agent will provide you with this analysis.
Square Footage Price is determined by dividing the living area (GLA) into the list price of the home. It is helpful to know the average price per square foot of similar properties in the area that have sold recently to determine how the property you are interested in compares.
List Price to Sale Price Ratio is often used to determine how close to the asking price of a property people are paying in the current market place.
Original Price to Sale Price Ratio is looked at less frequently but can be very helpful in a slow market. Sometimes comparing a property using the ratio of LP to SP and OP to SP can be a very accurate measure.
Tax Assessment Ratios can be helpful in comparing the tax assessed value of a property you are interested in with the ratio of the tax assessed values of homes sold in the immediate area compared to their sale price.
Appraisals are required when a buyer uses a lender to finance a home purchase. Typically the appraiser asks to see a copy of the Purchase and Sales Agreement prior to doing the appraisal. Engaging an appraiser prior to making an offer on a property can give a very effective price point for the purchase.
When home prices are rocketing, you may at least want to include a clause that makes the purchase subject to the property appraising no less than the purchase price.
Now that you have considered everything and made a decision it is time to write the offer. next topic »
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