More and more property owners in the States are willing to negotiate price, to an almost unprecedented degree. The crisis in the sub-prime mortgage industry has led to an untenable situation for many homeowners who are faced with skyrocketing payments from their adjustable rate mortgages.
While the current drop in house values can make for some interesting bargains, there are also some safeguards you should take in this market. One of them is to demand an appraisal contingency:
In addition to the standard financing and inspection contingencies, it's a good idea to include an appraisal contingency for the property to appraise for the purchase price. Due to the softening market, some appraisals are coming in low. If you make an offer without an appraisal contingency and the home appraises for less than the purchase price, you could have to make up the difference in cash.
But if you have been thinking of buying, you should take notice of the confluence of current circumstances. They are unique and, obviously, time-sensitive.