I think it is too early for reasonable (IMO) lowball offers. I made an offer on an El Cajon REO condo that is listed for 181K. It sold for 268K in 2005. There is an identical unit in the same complex listed for 161K (possible short sale?) and another for 175K. I offered 125K as that is what I feel comfortable paying and makes sense considering current rental prices. I didn’t expect it to be accepted but was interested whether I would get a counter offer. I did not.

I’m not sure if counter offers are usual. My guess is it might sell this year for around 160K but I think I will do better for the money later on. I’m starting to think SFR (no HOA) may be doable in a few years. I’m going to sign a new lease in the next week.

The bank asking price is already 33% off the 2005 sale price. My offer was over 53% off peak, or an additional 30% off the current asking price. I think 2000-2001 prices seem reasonable as well but it will just take a few more years of chasing the market down for banks to get it.