I hear the question a lot. I see the same question quite a bit when I'm browsing around forums on the internet. We definitely see it in the offers that come in on our Jacksonville listings. I'm not sure why buyers are so convinced that they are supposed to offer a certain percentage off of asking price when trying to buy Jacksonville real estate. The reality is that is the way the majority of buyers look at the process. This is faulty reasoning and can hurt you in your real estate transaction.
Here is a simple example:
House A and House B are identical floor plans, same Jacksonville neighborhood, etc.
House A is priced at $400,000 and is the highest price in the neighborhood.
House B is priced at $325,000 and is the best price in the neighborhood.
The owner of House A is willing to agree to 10% off of their $400,000 asking price while the owners of House B are standing firm at $350,000. Which one is a better deal?
Does the fact that you got $40,000 off of the asking price make House A a better deal? Well of course not. However, many buyers will feel better about that house at the end of the day instead of the one that they couldn't get the sellers to reduce. Looking at this example the error in this rationale is probably obvious to you. But we see it happen every day.
If you are a Jacksonville real estate buyer, please understand that the percentage off of asking price you get is not indicative of a good deal. Many homes today are fabulous deals even if you were to pay above asking price for them. You have to somewhat "ignore" the asking price when analyzing the deal and look at the whole picture.
You need to see all of the comparable properties and analyze the situation. You need to look at sales for the past 3 months (anything beyond that is likely to be overpriced right now due to the fourth quarter of 2008 seeing more substantial price drops). But don't stop there. You need to see (if not physically, on paper) every home that is comparable that is currently on the market. This data is how you measure your deal.
Do not fall for the average percentage off of the asking price that Jacksonville real estate is selling for. Do not take the word of someone else who tells you it is a good deal. This is one of the largest financial decisions you will make in your life. Ask for the facts and focus on the details that matter. We help homebuyers every day and believe that you must be completely educated before making an offer in this market. Let us know if we can help you! 904.371.9654.
