How much to offer - East Davis in Yolo County

Several times in the past few months people coming through an open house have mentioned that their agents are not willing to make offers for less than about 2 percent below list price. Last week one of these people said her agent made her feel like an idiot for wanting to make an offer 7 percent below list price.

This isn't surprising - Davis is a desirable community and our agents generally do an excellent job of pricing their listings. But is it true that making an offer more than 2 percent below list is a waste of time?

The buyers I was talking to were looking in East Davis, which has most of the affordable (by Davis standards) homes and so is a place that first time home buyers consider. People use different definitions for East Davis, but mine is Davis east of L Street, west of Mace Ranch, north of 5th Street and south of Covell. In July, 7 houses sold in this area - how did the buyers do?

List Price Selling Price Percent below List

$300,000 $274,000 8.67

$299,900 $280,000 6.64

$347,000 $335,000 3.46

$384,900 $378,000 1.79

$427,900 $419,000 2.08

$439,900 $430,000 2.25

$518,000 $519,000 0

Judging from this very limited sample buyers might be able to get a good discount on low end houses that need substantial work and a limited discount off list for mid range homes in good condition. But since these numbers show that a 2 to 3 percent discount off list is possible buyers in this market shouldn't hesitate to offer 4-5 percent below list price for these homes but be prepared for a counteroffer.