In the spirit of the new Obama-US love in: I believe we have a duty to protect the constitutional right to bear arms, er, to arm bears... yeah, arm bears, that's it!
Sales will pick up this spring. Not much we can do about (not that I'm arguing we should do anything either). But we can help those smart enough to wait out the first 13% drop in prices before hopping into the market. And we can also help those of us waiting for at least the next 13% before we start shopping for boxing day deals.
This post is dedicated to arming bears with low-balling tips. If you're going to buy this spring, make sure you buy with the end in mind. Don't settle for 2007 prices when prices may head all the way down to 2005. Stephen Covey, the leadership guru, tells us in his 7 Habits book "to begin with the end in mind." For me, the end is 2005. I'll be good with 2005 prices. That's where I'm going to start.
And gosh golly gee, the good folks at BC Assessment and their friends who run my PCS service have made it that much easier for us to begin with the end in mind with their "tax info" page.
Pretty simple stuff here folks. The "real" assessed value for today is the lesser of 2008 or 2007. Ignore those numbers. Jump all the way back to 2005. Red light stop, green light go.
If I were to make an offer on this over-priced fixer upper with limited square footage potential, I'd start at $285K. Seems harsh doesn't it? I might have a hard time convincing my buyer's agent to deliver that "insulting" offer, but in today's low sales market I doubt it. It's a buyer's market and, gosh darn it, it's my turn at the wheel for a change. I think the savvy REALTORS understand this and will do the buyer's bidding.
Anyway, back to the offer: $285K is a low-ball offer of 19% off the asking price of $349K. It's only $65K. Remember the vendor has already priced their property at just above 2006 prices, so they know which way the market is headed and they're trying to beat it. Good for them. Better for the buyer though.
But here's the catch for armed bears: don't get sucked into the counter offer nonsense. It's the number one tool in the car sales game and it's made its way into the real estate world too. The game is we go back and forth until we meet somewhere, the winner is usually the one who gets the other to move farther from their original position. You can beat the game by not playing it. Offer is final, and conditional to inspections. Walk away if they won't play on your rules.
If the offer is rejected, move on to the next target. This spring will be a target rich environment. So put on your dress whites, find the loving feeling you lost, and be the Maverick. You've got nothing to lose, and the best part about playing the game with this simple rule is the longer it takes the more you will save. Beautiful isn't it?
So folks, that's my one tip for arming bears. We all know there are many more out there. Please add yours in comments and do your best to serve the real estate constitution first amendment: the right to arm bears.