At this stage, your best course of action is to take the seller’s word on the value of property with a pinch of salt, so to speak. You don’t have much to go on at this point, unless you know very well the area you’re trying to buy in, or you’ve already made your comparisons with neighboring properties.
Consider what the seller is saying with a measure of credibility – they should at least have a fair idea because they live in the area. Plus, their motivation level and knowledge of prices – or lack thereof – should be a good clue to help you decide whether you’re going to be interested in the property or not.
After all, what’s the use of continuing a transaction with a seller who’s not even highly motivated about the property he is selling?
You may also want to check out sites like www.realtor.ca. It will give you a rough idea of the property values in the area, without the need to consult a realtor. Of course it will not give you the true market value, but at least it offers to help you formulate some good insights because you’ll know what realtors are actually asking for houses similar to the property you’re eyeing.
It’s important to note that realtors sometimes aim a little too high when it comes to prices, and that’s quite understandable. If YOU were a realtor, wouldn’t you do the same? So for example, if the houses in the area fetch at $355,000 and your seller is asking for $330,000, then it’s slightly below the market value which is a good thing to begin with. If you can get the seller to drop the realtor’s commission, approximately $14,000, then you’ve got yourself a fairly good deal.
Mind you, it’s not a great deal, but it’s still good. That should be enough to help you build your momentum. Good luck!