The best question your agent can ask the listing agent is what could the buyers (you) do differently to be the winning offer next time. Sometimes it's about more than price-it can be terms, such as free rentback or zero contingencies.
No matter how you slice it, prices are up and projected to keep increasing short term. While good for sellers, many of whom are finally moving back into a positive equity position, itâ€™s bad news for buyers. Itâ€™s especially hard on those buyers who canâ€™t seem to figure out the current rules of engagement.
Normally, a property is worth what a buyer is willing to pay. If there are plenty of houses, buyers can determine what they want to pay for any given house and make an offer. If they canâ€™t get their offer accepted, they simply move on and keep at it until a seller agrees with their assessment and accepts their offer. The best tool for buyers to use to determine price is a Comparative Market Analysis (CMA) provided by their Realtor.
In the current increasing market, however, this approach doesnâ€™t work. In fact, buyers adhering to this practice more than likely wonâ€™t get a house. Instead of using the CMA to determine what THEY are willing to pay, they need to use it to figure out what OTHERS might be willing to offer. Even if they think a given property is priced too high, they have to acknowledge that there might be at least one other buyer out there willing to pay list price and higher. Therefore, if they want the home, they must write their offer based on what they think someone else might offer â€¦ and then write higher yet.
Itâ€™s a hard lesson for buyers to learn â€“ especially those analytical sorts who want to do everything by the numbers. But learn they must â€¦ or keep renting.
Here is a post that may be helpful:
Tough Year Ahead: Top 10 Issues Facing Bay Area Buyers
If you want to buy you need to take your best shot and not try to pay just a little more than the other buyers. You need to make offers that reflect what you can and will pay. If you are not successful you will know you tried your best. If you are successfulâ€¦well, that is what you are trying to accomplish, isnâ€™t it.
If you were getting a loan and they got cash offers, unless you were a really high bidder, they would have chosen a cash buyer. At least you can get that info from the listing agent.
Most properties right now are getting many offers and are selling way over asking price. I have buyers willing to pay more than $50K over asking price in a $400,000 price home and they are still not able to get it since there are all cash offers willing to pay even more than that.
You have to keep trying and just feel that you gave the best offers you could.Comarative Market Analysis does not mean much these days since inventory is low and buyers will still pay more than what the homes in the area have sold fo to be able to get a home.
I have buyers who are analyzing all day and want to look at data to justify the price they want to offer, but in today's market it means nothing and the home sells to the buyer that is willing to pay the highest whether that offer price makes sense or not.
In addition to the spot-on comments shared below, keep in mind SOLD comps are a "lagging indicator" of â€œmarket valueâ€ due to the escrow process â€“ and especially when the SOLD is Short Sale!