How do you fight the banks when their counter offer comes in too high? Read below for a rebuttal we just did for one of our clients in Centreville because their bank countered our short sale contract too high.
Centreville, VA
To Whom It May Concern:
 
I, Jennifer Young, am the listing agent of the above referenced property and am writing to tell you that the investor’s counter of 510K is too high for the subject’s damaged condition, small size, current market conditions and the market won’t bear a price close to it. The current buyer has countered with a highest and best offer of 470K and this is the highest that the market will bear. In addition to getting the buyer to come up in price we have also been able to work with the title company to have them reduce settlement fees and attorney fees in order to net the bank/investor a higher amount.
We have had 15 showings on the property since we have been listed and were on the market for 20 days before we got an offer and had great market exposure on hundreds of websites, did print marketing, etc.. to properly expose it. The current offer was our only offer and we only got it once we reduced the price to 499K based on condition.
The subject property has great curb appeal and a nice lot but it is VERY beat up inside as the owner rescues animals and her house is full of dogs and cats that have beat up the property. The property does not show as well as the pictures show because we hid as much as possible when taking marketing pictures. Here are some important things to consider when considering this counter and comparing to recent sold comps:
-the kitchen is basic and dated w/torn vinyl, cheap laminate counters, no upgraded appliances, etc.. most buyers in the 500K+ price range want and expect an upgraded kitchen with ceramic tile, granite, etc..
-the paint is bold throughout with drywall seams showing and areas of water damage on the upper level. We have been told that the roof needs to be replaced which will likely be 10K or so  and that is likely what is causing these leaks.
-the flooring throughout the house, specifically on the upper level stairs and upper level are very worn and stained from the animals and need to be replaced.
-The basement is mostly unfinished which has turned off some buyers. Most buyers prefer a fully finished basement in this neighborhood . The subject property has one finished room that was cheaply done by the homeowner.
-Besides these items the HVAC and hot water heater are on their last leg and need to be replaced soon as d the garage doors that have wood rot and there are driveway damages.
Our Spring market started off strong in Feb-March but slowed down due to an increase inventory and many properties have been sitting. Currently there are 8 properties currently for sale in the Sully Station community, 4 other ones that are under contract and 6 that have sold all year. These statistics show that in this neighborhood, the market listings are in high supply compared to the under contract properties creating an oversupply of properties and more of a buyer’s market in this late spring market.
See below for the best comps to compare the subject property to. Please note again that the subject has 2,178 living area sq ft, no upgrades and many damages throughout.
1)      14639 Soucy Pl listed for 499,000 and sold for 485K with 8K in cc for a net sales price of: 477K on Jan 23^rd. This property had 1984 living area sq ft, had hardwood floors throughout and kitchen updates including granite counters. It also had remodeled bathrooms and a nice rear screened porch. The basement was fully finished. If you adjust the subject up by about 10K for it’s addl sq ft, down about 10K for it’s kitchen upgrades and down about 10K for the addl basement finished sq ft you get to an adjusted net sales price of: 467K. This is very much in line with our original offer.
2)      14318 Brookmere Dr listed for 515K and sold for 497K with 2K in cc for a net sales price of 495K on 1/6/14. This home is much larger with 2,542 living area sq ft, has a complete kitchen remodel, bathrooms are remodeled and an unfinished basement. If you adjust this down by 15K for the larger sq ft, down by 10K for the upgraded kitchen, down by 10K for the bathroom upgrades and up by 15K for the partially finished basement that the subject thas then you get to an adjusted sales price of: 475,000. This is again in line with the buyer’s counter.
3)      5200 Braywood Dr listed for 499K, sold for 495K and 7500 in closing costs for a net of$487,500 on Dec 27, 2013. This property had 2,170 living area sq ft so it was a very similar floorplan though this house had 3 large bedrooms up. It did had upgrades throughout with new carpet, new paint, upgraded kitchen w/ ss appliances, etc.. the basement is also fully finished. If you adjust the subject up by 7500 for the 4^th bedroom up (again even though the sq ft is the same), down by 10K for the kitchen upgrades, down by 10K for the addl basement sq ft and up then you get to an adjusted sales price of:  $474,500, again in line with our counter.
 
In summary, because of the property’s basic condition in the kitchen and bathrooms, lack of updates throughout, beat up flooring, walls, etc.. from the many pets, partially finished basement and small sq footage, the buyer’s counter of 470K is in line with market value and should be accepted. Thanks in advance for your consideration and please let us know if you need anything further.
Thanks in advance for your consideration,
Jennifer Young
Realtor, Keller Williams Realty
703-400-6757