Low-ball offers very common in this market

I've had several people ask me recently about how local homeowners can counter what they believe to be "low-ball" offers from people offering to buy their home.

First, I think such offers are becoming increasingly common in today's local housing market, where bargain hunters abound and many homes are selling for less than what it would cost to build that same house today.

To me, the best way to approach what a seller considers to be a very low offer is to counter with a reasonable sales price.

If you ask Realtors, they'll tell you one of the most common mistakes sellers make is setting an initial asking price that is too high for current market conditions. It's only natural, I suppose, since homeowners have a built-in bias. Most of us think our home is worth more than it really is.

An unrealistic asking price can be a bad move, especially in a housing market where home prices may still be falling. And, if prices continue to slip while the home is on the market, an overly aggressive listing price just looks higher and higher as time goes by, turning off more potential buyers.

Assuming your asking price is in line with market conditions, one effective tool to determine a buyer's real level of interest is to provide both parties with updated sales information on relevant properties that have recently sold.

I've found that serious buyers typically continue negotiating until both parties come to some sort of agreement on the final sales price. Throughout the negotiations, a good Realtor will continue to check the Multiple Listing Service for comparable sales to make sure the home is selling for a fair price.

Keep in mind that sales prices of comparably sized homes in the same or similar neighborhoods can vary based on location, the overall condition of the home and those surrounding it, among other factors.

In a market dominated by bank-owned homes that are far too often found to be in poor condition, properties in good and updated condition continue to sell for higher prices than those needing substantial repairs.

Some help in this area arrived Sept. 1, when appraisal reports from Fannie Mae, the nation's largest source of funding for home mortgages, began including new sections designed to more accurately compare competing properties and their overall condition.

These new appraisal reports affect a sizable percentage of local homes on the market. It helps that they are now taking into account recent improvements to the home.

This is a good change that should help appraisers provide better estimates of the true market value of a home listed for sale.

It may also help owners of homes in top condition demand a higher price than similar homes nearby that may be in subpar shape.

I hope this helps potential sellers who are seeking the best possible price for their home.

For more information on such issues, consult a qualified local Realtor or visit lasvegasrealtor.com.

Paul Bell is the president of the Greater Las Vegas Association of Realtors. To ask him a question, e-mail him at ask@glvar.org. For more information, visit lasvegasrealtor.com.