Common Characteristics of Heavily Discounted Homes

By Barbara Pronin, RISMedia Columnist


In the quest to find a heavily-discounted home for sale, many buyers today are looking almost exclusively for short sales or bank-owned properties. But since, in most cases, the banks in question have already agreed to take a loss, it is likely there won't be room for much more negotiation at the table.

Savvy buyers may be wise to look for owner-owned properties for a better bargain in the long run, according to Redfin's "Science of Real Estate" website, which has identified several common characteristics of highly-discounted homes:

-Look for listings that have languished on the market for 90 days or more. Many owners will hesitate to accept a low offer if the home has been listed for only a few days or weeks.

-Find fixer-uppers. Heavily-discounted homes are 73% more likely to need some fixing up. Owners of homes that need some work are often more concerned about a quick sale than they are about a speedy sale. (But get the home inspected before you buy).

-Stay away from remodels. Sellers who have sunk big money into recently remodeled properties are 20% less likely to negotiate.

-Hunt for homes with long-term owners. Heavily discounted homes are 52% more likely to have been seller-owned for 20 years or more. The longer an owner has owned a property, the more equity he has accumulated and the more apt he is to make price concessions.

-Find the flippers. On the other hand, an owner or investor who is in trouble may be motivated by the need to reclaim capital instead of waiting for equity growth.

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Reprinted with permission from RISMedia. ©2013. All rights reserved.