Bidding Wars Catch Buyers Off-Guard
According to the Wall Street Journal, buyers all around the country are getting caught off guard in bidding wars on certain houses that are a good deal. And even worse, some buyers think that a less than full price offer is justified if the house isn’t really perfect. Result? They don’t get the home.Some buyers even comment that they thought the bidding drama was over yet we don’t understand why. All along, we have written articles explaining the market and just how very attractive it is. Ad so have many other bloggers and journalists written volumes on the very same subject.
In many cases, buyers forget the market is already deeply discounted so offers that are below asking are easily over bid. And offers with lots of “gimmees” are cast aside as are the offers that cite a less than full price offer is because the home needs some cosmetic facelift. All these things will be a cause for the offer to be rejected. Been there dozens of time this year already.
Buyers, against our advice, will instruct us to place an offer at less than our advise and guess what? They don’t get the home and this happens multiple times before the “get it”. I mean before they figure out we know the market and how to price an offer.
Why are things getting so competitive? Many of the bargains have sold already. add to that an unwillingness of some sellers to take less than they paid for their home years ago so they decide to wait for a while. Result: Less inventory and multiple bids on homes.
Now factor in a surge in investors snatching up homes in single or bulk in all-cash deals. They then do a cosmetic makeover and resell the home – aka FLIPPING! Yes its happening right now.
“The bidding wars caused by tight inventory provide the latest evidence that housing demand is starting to pick up after a six-year-long slump,” The Wall Street Journal reports.
Late last week, the National Association Of Realtors® said pending home sales in March reached their highest level in two years edging up 12.8 percent from a year ago.
Source: “Stunned Home Buyers Find the Bidding Wars Are Back,” The Wall Street Journal (April 27, 2012)
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(all data current as of 12/12/2013)
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