How to Buy a Big House For a Small-House Price

Posted by Nick Niesen on November 8th, 2010

If you are considering buying a house within the next two or three years but are waiting until you can afford the house of your dreams, you may want to reconsider.

With housing prices going up as much as 10 percent per year in some areas, the longer you wait, the farther that perfect house can move out of your reach.

Along with the hike in house prices, interest rates are starting to creep up as well. This is even more of an incentive to buy a house now, rather than later.

How can you get a big house for a small-house price? The following tips will reveal the secrets to getting a great deal on your dream house.

1. Get to know house values. Before you get started, look at the areas in which you want to purchase a house. Monitor the prices of houses in that area until you are fairly comfortable with those values. Your goal is to know the value of homes so well that a great deal will be obvious to you.

2. Make low offers. Start by making offers that are as low as 65 percent to 70 percent of the asking price. Rather than making only one offer at a time, make five or 10 offers each week. Make sure you write "To be deposited only upon acceptance of this offer" on your earnest deposit check.

3. Expect most of your offers to be rejected. You'll know you are on the right path when your real estate agent complains that your offers are too low.

4. Wait for a great deal. If a seller accepts your offer, or counters with an offer at 80 percent or less of the home's value, you've probably found a great deal. You will be able to live in a bigger house than other buyers who

didn't take the extra time to find a seller willing to sell for less.

This strategy will test the patience of both you and your real estate agent. You will be tempted to think that no one will ever accept one of your low offers. However, when a good offer finally comes along, the extra space you get to enjoy in your new house will make it all worthwhile.