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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Mixing projected net equity with the maximum bid.. Posted by Ward-CA- on April 07, 2003 at 11:34 PM In Reply to: Projected Net Equity question... posted by 2nd Fred on April 07, 2003 at 10:39 AM : Hi Ward, : What I should be looking out for when figuring a bid price on a piece of property? I know the FMV is probably the most important number, but what is the "contribution to buyer's cost" number? Should I figure in a 6% selling commission here in CA? What's the average for the transactional expenses? : Finally, what's the best way to figure a maximum bid? : As you can probably tell, I'm just starting out. : Thanks, : Fred =•=•=•=•=•=•=•=•=•=•=•= Fred, There are 3 different markets in the real estate game. There’s the Seller’s market, the Neutral market and then the Buyer’s market. When you’re trying to sell a house in a Buyer’s market you better be prepared to pay part of the Buyer’s closing costs or the buyer will find some other seller who will. That number is probably $3,000 to $5,000 depending on the sales price of the home and the depth of the Buyer’s market. There’s now a fairly acceptable alternative to paying a 3% listing commission. Find a flat fee broker who will put your property into the local MLS (Multiple Listing Service) for $200 to $300 regardless of whether you eventually sell the property or not. So if you eliminate half of the 6% commission using a flat fee broker, then your commission cost drops to 3%. The transactional expenses of title, escrow, termite, etc. average about 1.5% of your sales price. Figuring out the maximum bid takes no more than 5 or 6 minutes once you know how to do it. But it takes me 4 hours to initially teach someone all the components and how they fit together. Far too long to answer in a post/reply. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : : Hi Ward, : : What I should be looking out for when figuring a bid price on a piece of property? I know the FMV is probably the most important number, but what is the "contribution to buyer's cost" number? Should I figure in a 6% selling commission here in CA? What's the average for the transactional expenses? : : Finally, what's the best way to figure a maximum bid? : : As you can probably tell, I'm just starting out. : : Thanks, : : Fred : =•=•=•=•=•=•=•=•=•=•=•= : Fred, : There are 3 different markets in the real estate game. There’s the Seller’s market, the Neutral market and then the Buyer’s market. When you’re trying to sell a house in a Buyer’s market you better be prepared to pay part of the Buyer’s closing costs or the buyer will find some other seller who will. That number is probably $3,000 to $5,000 depending on the sales price of the home and the depth of the Buyer’s market. : There’s now a fairly acceptable alternative to paying a 3% listing commission. Find a flat fee broker who will put your property into the local MLS (Multiple Listing Service) for $200 to $300 regardless of whether you eventually sell the property or not. So if you eliminate half of the 6% commission using a flat fee broker, then your commission cost drops to 3%. : The transactional expenses of title, escrow, termite, etc. average about 1.5% of your sales price. : Figuring out the maximum bid takes no more than 5 or 6 minutes once you know how to do it. But it takes me 4 hours to initially teach someone all the components and how they fit together. Far too long to answer in a post/reply. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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