The question below gives a high level idea of the financial risk you take when bidding on real estate if the property is not valued properly.
Q: Someone in our online forum asked if it was okay to pay $620k for a completely updated dated 3br 2.5ba house in Greenville, Delaware, stating that a house next door sold for that much in 2006.
A: Without seeing the property and comparing it to other sold homes in the area, it would not be possible to give you an accurate answer and would do you an injustice to try to give a yes or no at this point. Meeting with a professional realtor who has experience in studying and pricing homes accurately, and negotiating is recommended to inform you and protect your interests.
However in general, the market is down since 2006. For all of 2006 in the Greenville, Hockessin, Centreville area, the average sold price for homes (that settled in the $50k to $2mm range) was $556,906. Whereas the average sold price for the same range of homes from July 2008 through Feb 2009 was down to $490,602.
To peg the bid for your next home strictly on one home's sales price next door that sold in 2006, would be risky. If you would like an analysis prepared for you, please contact a professional realtor. Typically real estate agents do not charge to work with buyers (we do not), and therefore your representation is free - from finding a home with you, through negotiations (and re-negotiations after a home inspection if needed) - all the way through settlement.
Please let us know if you have further questions or would like a detailed analysis prepared for you.
Sincerely,
John Luca - Licensed in PA, DE & MD
Full Time Expertise - Working Full Time for You!
