Make sure your comparables are a close match to the property you are placing an offer on. Square footgage, age, number of bedrooms and sale date are all very important.

I am assuming you are getting a loan. Your lender uses the appraisal to determine value. A lender will not loan you money on a home over the appraised value.

It is typical for the banks to accept a cash offer that is less than the asking price but usually not 50 to 60 thousand.

Again look at the most recent "Sold Comparables".

Dear Hopeful in Corona,

Just like the other agents have already mentioned, it is all about supply and demand. Right now, there is not enough inventory on the market and when a good new one appears, it may get multiple offers in just a few hours. With the interest rates being so low and the first time home buyers credit being offered, and home prices being low, it has made buying a home very affordable. This is especially true of people who thought they would never be able to buy again in Southern California. I even thought my son would never be able to buy because of the prices, but now things are affordable which is great.
What I would do is this: ask your agent to run comps for the house you are interested in purchasing. This way you will know what you should pay for the home. Many times, the banks purposely put the home up for sale at a lower amount than market to generate multiple offers. The one thing you don't want to do is make your offer for more than it would appraise because then your offer won't even be considered. Many buyers make the mistake of thinking that the higher they go with their offer, then they are sure to get it. Not necessarily....the banks know what the house should sell for and they will not sell it for more than the appraised value. So, do your homework, have your agent run comps and then go from there. It is tough out there, but keep trying, everyone is in the same boat.

Kind regards,

Joan Patterson, B.A., A.S.P., G.R.I., Realtor, License #0141647
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730
951-204-1864 http://www.calljoan4homes.com http://www.socalreopartners.com

Something similar is happening where I am, in Northern Virginia.

It's supply and demand, as one of the other answers notes. But it's a bit more complicated than that, at least in Virginia.

Back in January and February, there were plenty of properties on the market here--lower priced foreclosures and some short sales--that only investors were buying. The "retail" buyer--the ordinary person or couple who wanted to buy a home to live in--weren't buying. So, to take one example from around here, there were properties that had sold for $350,000 a couple of years ago that were selling as foreclosures to investors for $70,000. The investors would repair the homes, then resell them for maybe $130,000.

Then around March the "retail" buyer came back into the market. These were adventurous people who were willing to buy a foreclosure and move into it themselves. And they started paying more--maybe $100,000. It was still a very good price, but it was too much for many investors, who got squeezed out of the market. The numbers didn't work any more when you had to pay $100,000 for a property, put $15,000 into it, and sell it for $130,000. But it was still a good bargain for retail buyers.

So if you go back through the records, you'll see those homes were purchased for $70,000 in January. But now you can't get them for under $100,000, and probably more.

So, if you were around here, that's the explanation for how some people got such good deals. I wouldn't be surprised if something similar had gone on where you are.

Still, the bottom line is: How much is the home worth? Don't worry that someone paid much less for a home. Sure, they got a great deal. Ask yourself: Is it still a good deal? Have a Realtor run the comps. And use your own judgment. In your case, it still might be a very good deal for $50,000 more. If it is, buy it. If it isn't, don't buy.

Hope that helps.

Unfortunately the inventory has gone down in most areas which means there are fewer homes available causing the market to strengthen. When there are more buyers and less homes it causes the prices to go up. (Supply and demand, simple economics) The prices typically have only gone up slightly but you might be comparing homes that are not in as good of condition or not in as good of an area, or you may be looking at incorrect facts regarding the sales. (Some of the homes on trulia and zillow are not actual sales prices).You may be you having to ask for closing costs, which means you are actually financing your costs in the purchase. You actually aren’t paying more for the home you are asking to borrow that money and adding it to the price of the home. There still are deals out there but you have to look hard and you have to have a strong offer.

Good Luck
Diana 909-945-5763

We are getting multipul offers on homes.
If you know where you want to buy call me I will find you your home.
1 949 235 0099