Making an Offer to Buy a Home
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It's always helpful to find out why the seller is selling; however, you might not be able to obtain that information because the listing agent may refuse to tell you. But you can gather information without relying on the listing agent's cooperation.
Check the temperature of the marketplace. It is the market hot, cold or neutral? If you're making an offer in a buyer's market, you will have less competition for the home. Sellers will be more likely to be receptive to any offer because there are fewer buyers. If you're buying in a seller's market, sellers might not consider any offer that is less than list price. In fact, sellers could very well receive multiple offers, which means your offer should be as attractive as possible to win acceptance.
Unless the seller is in default and willing to participate in a short sale, the seller is unlikely to accept an offer for less than the mortgage(s), plus closing costs. If the seller has an extremely high mortgage balance, and the property is vacant, you can assume the seller is making those mortgage payments out-of-pocket, probably paying on two homes.
While it is true that in many cases the price the seller originally paid for the home has little bearing on today's market; however, if the seller purchased a few years ago in a depressed market, with little appreciation since, the asking price should be closer to the seller's purchase price. Although you may not be able to figure out the condition of the home when the seller bought it, nor whether the circumstances were extenuating, you can adjust for increases due to appreciation and remodeling improvements. When looking at comparable sales, use only the properties that are similar in configuration, age and location to the home you want to buy. Use the data from the most recently sold sales, and don't look beyond six months because appraisers won't.