1. Was there a recent price reduction?
Chances are the property sat on the market and had trickle down price adjustments until the right one got buyers excited. Keep in mind most bank asset managers don't live in Califonia and price the home wrong. It could take months for the listing agent to get the bank to be more realistic about price.
2. How quick does the bank respond to offers?
Sometimes it takes weeks to get a response from the bank to decide which offer they want. Perhaps buyers came and went tired of waiting for an answer. It's possible at all times they have had multiple offers.
3. Did they recently make improvements to the property?
Sometimes a home will sit on the market in bad condition, definitely not in move in condition. The bank will finally make the decision to fix the house up to generate buyers.
Remember you are always the one in charge of offering want you want on a house. It's important your agent runs the comps for the neighborhood. I would not pay over market for a home in todays market. But just because you offer $10K over list doesn't mean it couldn't be $20K under market. You will be getting an appraisal that will determine the value.
I always tell my clients that you need to offer what you feel comfortable paying for the home so that if someone offers a $1 more you are fine with letting them have it with no regrets.
I work in the Valencia area as a Mortgage Advisor, so my answer is going to be from a lending viewpoint. Chances are I may know your realtor too. I say don't concern yourself with whether or not there are multiple offers on the property. If that is indeed the case, you only need to decide how much you are willing to offer AND at that offer price are you comfortable with your monthly payment, etc.
If you really want the home and want to offer more, there are financing strategies that actually allow you to pay more but have the same or even a lower monthly payment. I know that sounds strange but it's true and it's actually no more risky than a plain vanilla 30 Year fixed rate loan.
I would caution you not to focus too much on paying exactly the 'right' price. Interest rates are moving generally higher these days so it could actually COST you more if you wait. I don't know what price range you are looking, but I can tell you just a .25% increase in interest rate on your loan will easily wipe out a $10k difference in price savings. You're paying that higher interest rate for the life of the loan, whereas you only pay the higher price for the home once.
Lastly, and it's no secret, but any offer you make MUST be supported by comparable sales in the area and finally an appraisal. So you could offer $20K over the asking price, but if it doesn't appraise you're stuck paying the difference or you get to move on to the next home.
Please feel free to contact me with questions. I love working with buyers and helping them find financially sound solutions to their financing needs.
Certified Mortgage Planning Specialist
But, proving this #??? Jeanne, has agreat idea with writing an escalation clause. But, anything that dirties up the offer or complicates an offer also runs the risk of getting rejected. That is why the bank wants your "Best and Highest" offer and the Bank will then determine which offer makes the most since for them... The "Best" offer isn't always the "Highest" offer...
Good Luck and KNOW your Local market and you'll have No regrets!
If you are purchasing in Valencia, I assure you I am far from that location & do not have any buyers I'm working with in that area, if you'd like an outside opinion, feel free to shoot me an email with the address & I'll check into the price reduction history for you.
If you don't want to do that, just have your agent REALLY analyze the comps, is it still a great deal at $10K over the current list price?
Realtor Since 1996
It begs the question, how will you know if there really is another "bona fide" offer - in order for the escalation to be triggered it must be proven. It is unlikely that the offer will be shared with you, but it could be shared with your attorney.
I've had this work well in competitive bidding situations - but I've never used it with an REO. Talk to your agent about it and see if she thinks it has merit.
Good luck to you,
Unwavering Commitment to Service
There are many homes currently that have multiple offers, especially if they are priced well or in highly desirable condition. You really need to rely on your Realtor to get you the answer and hopefully your are working with some who has earned your confidence. If the listing agent does not tell your Realtor the truth, there really is not much that your agent can do. Of course if there is misrepresentation, etc. it could be taken further, such as a grievance with our Board of Realtors filed by your agent, etc. Even then there is no guarantee you will find out the actualy situation.
Best of luck!
Best of luck.
Multiple offers often create bidding wars. Nevertheless, what's really inportant is not how much one bids over the asking price, but how the price you offer as well as the property condition, upgrades, etc. compare with other recent similar sales in the area.
Henry Best - Broker/REALTOR
Cash 4 Buyers Realty
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
Bank owned/REOs are getting multiple offers in this market. Most REOs in Santa Clarita are priced at 10-12% below market value. If you really want a good chance at purchasing the home, you might need to offer more than their asking price.
Has your agent shared the true comps with you? Do you know exactly how much (price per sq. ft.) other similar homes have sold for within the past 3 months? These are answers that your agent should be providing you.
Many banks are simply asking buyers to submit their "highest and best" offers. They are not interested in negotiating back-and-forth, but they will simply choose the best offer for them.
Best of luck!