Home Buying in Riverside>Question Details

kevin nguyen, Real Estate Pro in Riverside, CA

Crazy market, with all cash buyers over pay for every deal,

Asked by kevin nguyen, Riverside, CA Thu Feb 7, 2013

how a conventional buyer get to buy a house these days? any tips? I got outbid all 5 offers with already 10k above list price. Increase more offer price above true market value to win all cash offers is not an option for most buyers.

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Kevin Allen’s answer
Being a buyer in this market can be incredibly frustrating. The rules of the game seem to be changing almost constantly.

I agree with Jory that perseverance, connections & strategy get the job done. Our buyers team that consistently helps dozens of clients each year has specific ways to give you an "unfair" advantage over those represented by other agents. We have built tremendous relationships with local agents over time, think outside the box, and work tirelessly on your behalf to obtain the home you desire. I'd encourage you to interview several of the top buyer's agents to see who will deliver the best service.

Kevin Allen
951-315-7001
http://www.RE-STORY.com
1 vote Thank Flag Link Thu Feb 7, 2013
Hi Susan, I am able to get HELOC from my primary home to pay all cash, but would not want to do so as I want to buy house within appraisal value of my lender. Some listing agents told me the reason they go with cash buyer as they know "cash payers are over pay the price and they don't want appraisal contingency....." So even agents acknowledged that some cash buyers over bid and make this market bubble again.....
0 votes Thank Flag Link Mon Feb 18, 2013
Yes, that is a problem as well. Cash makes the closing go faster, but is it to your best interest and does it meet your goals? Having the HELOC is a good tool. When you use your HELOC, unless you have other sources to counteract the interest expense, the interest you pay on the HELOC could become stressful and eat away at any projected profits -- I've seen this happen to others, especially newer investors who happen to put themselves into riskier positions with their HELOC tied to their personal residence.
Flag Sat Mar 2, 2013
This has been the trend for the last few years. Unfortunately, cash would win in an offer situation like this. When you are using financing, when you "overpay", you risk the property not appraising to meet the underwriting requirements of the banks and the secondary lending market. That is a major you would lose out on the property. If you are working with a licensed real estate agent with acess to the local MLS, your agent could filter the search so you are getting new listings every day.

Which area of Riverside are you looking at? Most of it is already at retail market price. If you overpay, you are not likely to make much of a profit unless you are able to recover that via buy/hold.
0 votes Thank Flag Link Mon Feb 18, 2013
The price paid is the true market value at least to that buyer. They do have the satisfaction of knowing that most banks are going to wan the home to appraise out.

You are right that most buyers can not exceed what they are qualified for. All cash buyer does not mean that they are not getting a mortgage, just that they feel comfortable with their ability to do so and willing to risk their deposit.
0 votes Thank Flag Link Mon Feb 18, 2013
Investor101, The lack of inventory has certainly resulted in increased competition and more difficulty for those wanting to buy properties with financing. I have had some preapprovals in drawers for up to a year now. And, on the other hand, I have preapprovals that are in contract as soon as I issue the preapproval letter. And, yes, offers accepted have been FHA and VA loans!

There are some similarities of the successful files:

1). First and foremost, every successful buyer has had a kick tail, remarkable agent. Hands down, some of the best I have seen in 20 years. You know they are good when the seller accepts their FHA borrower over a cash investor (Absolutely true story...in the Bay Area no less!!).

2). The borrower is prepared (preapproved), realistic and listens to the counsel of their agent. This is not a market for "I need to think about it" or "I will speak to a lender when I find a house".

3). All ducks are in a straight line for a quick and smooth closing.

There is one similarity to the preapproval files in the drawer:

1). The borrower is insistant that they can find a home on their own. Every update of the preapproval letter is sent to a new agent. Essentially, the consumer is bouncing all over the place rather than interviewing and hiring a agent to represent them.

Just observations from your friendly lender....find a great agent and take their lead and advice very seriously.

All my best,

Deborah
NMLS #279125
(951) 795-4547
0 votes Thank Flag Link Fri Feb 15, 2013
Yes today's market is very frustrating with the low inventory causing bidding wars that some can't compete with.

With that being said I agree with Kevin! Interview and find yourself a top buyers agent, that specializes in the area you are planning on purchasing your new home. He said it best with the top agents having relationships built while negotiating prior deals it gives you an advantage others don't have.

Don Eiges
951-520-6150 http://www.resultsbydon.com
0 votes Thank Flag Link Thu Feb 7, 2013
In some cases, going direct to the listing agent can work out well.
As a listing agent , I get many calls from buyers trying to go direct.

The fundamental problem is that banks or sellers aren't giving homes away at a discount, they still want max dollar.

On top of that , you have no idea what kind of agent you will end up with . Also , trying to pin down the listing agent is exhaustive work.
Give Kevin Allen a call...he is one of the most ethical hard-working , strategic Realtors I know...he'll get the job done for you...just listen to instructions.


Best of luck!

Jory Blake
951.742.3751
Web Reference: http://www.JoryBlake.com
0 votes Thank Flag Link Thu Feb 7, 2013
Thanks, I even offer listing agent to go direct so they can have double commision, but that does not help. These are short sale deals, I guess cash buyer offer cash out side escrow or some thing I don't know.
This is very frustrated time to buy a house. We, the buyers, are to be blamed for creating houseing buble
0 votes Thank Flag Link Thu Feb 7, 2013
Choose one realtor work with so that they can focus on you and put in your offer
before the property hits the market. Find a realtor you can trust and you will succeed in your goals. : ))
0 votes Thank Flag Link Thu Feb 7, 2013
Perseverance, connections and strategy get the job done every time!

Jory Blake
951.742.3751
Web Reference: http://www.JoryBlake.com
0 votes Thank Flag Link Thu Feb 7, 2013
All California Mortgage has just developped the "Keys on Time" Loan Purchase Program to ensure that pre-approved and qualified purchase transactions fund on or before the scheduled Close of Escrow date.

Provided the loan type and the property type qualify for this program, and provided that we receives all required documents within the allotted time frames detailed in the program guidelines ...WE GUARANTEE IT.

Do not loose to a "Cash" buyer anymore.

Contact us, find out how the "Keys on Time" program can benefit you and get pre-approved.

Thierry

Thierry Abel
Senior Loan Consultant
All California Mortgage
A Division of APMC
P: (415) 464-8261
C: (415) 378-7508
F: (415) 464-2367
E: tabel@allcalifornia.com
NMLS 304353 - DRE 01380701
0 votes Thank Flag Link Thu Feb 7, 2013
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