What you should know about how estimate home value in Colombia.
Once you have choose your project, see how can you estimate home value properties in order to make a good deal. Anywhere you are going to buy in Colombia, make an offer and prepare to bargain!
MAKING AN OFFER
If you have a property that have a good chance to fit your needs, then you'll make an offer to the seller. This simply means telling the seller how much you're willing to pay for the house, if you decide to buy it. You can make the offer even if you're not 100% sure you want to buy the house.
Making the offer also generally doesn't force you to buy the house no matter what.
Although your real estate agent can give you guidance about how much to offer, you already have enough information to make your own call.
In the majority of cases as buyers we always offer a bit less than the seller was asking.
If you don't want to hassle with negotiation and you think the house is worth it, you can simply offer the same amount the seller is asking. If you want to try to get a better deal you can offer a little less than the seller wants, or perhaps see if the seller will make some other concession, such as paying part of your closing costs or making some repairs.
You can even offer more than the seller is asking. This is obviously unusual, but it happens in hot markets where houses move really fast. If more than one different prospective buyers make offers at the same time, obviously the seller will usually choose the highest offer. In cases like this competitive buyers will try to outbid each other to make sure they get the house.
This is what to consider when coming up with your offer:
• The advice of your real estate agent. An agent certainly is a lot more familiar with the market and the process than you are.
• Your budget. You obviously can't offer more than you can afford, but you should have realized whether a particular house was out of your budget long before it came time to make an offer.
• Payment way. When it comes to the price….Cash got the power! There will be always a 3%, 4%, 5% discount for paying in advance. For under construction or off-plan projects, although prices for new apartments are firm, usually developers give financial discounts for giving the total down payment in advance. But only if you have the cash to pay full price. Otherwise don’t expect a large discount.
• The home value. We all want to avoid paying more than something is worth, and this is especially true when buying a house that you might want to sell someday. But you might ignore this if the property itself is more important to you.
There is nothing wrong with paying more than a house is worth if you really want a house and you can afford it. Of course, even if you are willing to pay full asking price, it usually won't hurt to offer less to try to get a better deal, unless it's a hot housing market where another buyer might outbid you.
Offering more than market value for a home you really want works best when you don't intend to sell the home in the long run. An overpriced home takes longer to appreciate, but if you're not selling it then what do you care?
To get an approach of what's a fair price, a starting point is to ask for the average cost per meter in the project and compare it with others in the same general area.
What I know of construction characteristics in the US and Europe, allow me to say for sure that construction quality in Colombia have the same or often better standards than back home. The price for a luxury apartment in a Miami condo doesn’t include any finish characteristics, for example.
So the relation between price and quality is well balanced, compared to what foreign buyers have back home.
Right now the average cost per meter for residences in good condition, varies depending of several factors such location, kind of construction, number of rooms, etc.
- In the coastal area a property that fronts right to the worth more than one that is across the street from the beach.
- Larger areas cost less per square meter than smaller.
- Condo complex with amenities such as a swimming pool, spa, gym, children playground, dedicated parking space, garden area, etc. will cost more per square meter.
- Quiet locations, with residential profile in appearance but close to shopping malls, will usually cost more than that one’s is in the middle of a crowdie street.
For off-plan projects, developers makes their own market study to get a better approach for their proposed asking prices and features relative to the existing competitive market. Once the above information is analysed, they bring to light the initial pre-construction prices. Prices offered by developer’s sales offices are the same as those offered by all realty agents.
Normally, ten stories high apartment project will take 15 to 20 months for completion. During this time, the developer monitors constantly sales activity and compares it with other nearby or equal characteristics projects.
A developer will raise prices gradually during project construction. Price increasing rate will vary depending on market conditions. If it is a hot market, price could increase as many times during the construction phase at high rates.
If prices do not increase, or if developers offers “too-good-to-be-true” special deals to buyers, could be a strong indicator of an over priced project. This work the same in Colombia, in the United Sates or wherever.
Making an offer and negotiating the price is another favorable way to estimate your home value price. Now you're ready to close the deal.
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