Home Buying in Austin>Question Details

1sthomeboy, Real Estate Pro in Austin, TX

What strategies should I use when trying to when in a bidding war. My client can only spend 120k and we keep getting beat, even when we offered 15k

Asked by 1sthomeboy, Austin, TX Mon May 13, 2013

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11
I respectfully disagree with lowering the standards your buyer needs with regard to option periods, right to inspect, and appraisal and/or financing contingencies. Ultimately, if the buyer is getting beat every time (and this is happening to many, many buyers here in Austin now), maybe it's just not the right time for him/her to buy. The client can certainly look at homes with a lower list price and try to win that bidding war, but I am too risk-averse to advise my client to sign a contract to purchase a home without regard for the findings of due diligence or whether or not the house will appraise.

Higher option money, higher earnest money and flowers are nice touches, but when a seller has five offers to choose from - and they do - flowers are not going to replace a couple of thousand extra dollars in the selers' pockets.

All I can say is do your best to advise your client to make a wise and prudent choice - even if that means leasing for 6 months to a year and trying again later. He/she will respect you more for it and the loyalty of your clients is worth far, far more than this one closing will be. Good luck.

Cheers,
doug
1 vote Thank Flag Link Mon May 13, 2013
Look at the other items that are negotiable. Closing Time, Inspection period, etc.
1 vote Thank Flag Link Mon May 13, 2013
If you are getting in bidding wars and don't have as much ammo as the other side the result will almost always turn out the same. Lower the standards or find more money to offer.
1 vote Thank Flag Link Mon May 13, 2013
Well, you're the expert - you should be showing your client properties that they can actually buy, rather than properties are listed below market value. As our friend Ron Thomas likes to point out, the list price is merely a starting point.

All the best,
0 votes Thank Flag Link Sun May 19, 2013
Sorry for all the responses...internet was acting funny.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Mack, I don't think you understand the market in Austin. I have been showing my client plenty of houses that they can buy. The problem is that there are 8-13 other offers on every house in her price point. I appreciate your response, but people who are not in this market have no clue as too how fast things are being bought. Even my broker who does almost 40 deals a year is having the same problems.....too many cash buyers beating out the people who are getting financing.
Flag Tue May 21, 2013
Patience. No need to sacrifice the must haves of a buyer. And think creatively, as some agents have suggested here. It's competitive in Austin, advise accordingly.
0 votes Thank Flag Link Sun May 19, 2013
Careful because in this market 5-7 day option period is tough. We have a shortage of inspectors and scheduling one can be a week wait.

With any sales, you must have a compelling reason WHY a seller should take action. Paint a picture for immediate response needs, and be there first on a rainy day.

Hope that triggers some ideas for you.
Web Reference: http://shawnmon.com
0 votes Thank Flag Link Mon May 13, 2013
Take it to the bank! Think I'm playing? Works every time!
0 votes Thank Flag Link Mon May 13, 2013
Could you expound on this?
Flag Tue May 21, 2013
Obviously, the seller's bottom line is going to most likely be the prevailing factor. Having said that, an increased option fee for a minimal period of time is very impressive with all other things being fairly equal. An example would be $500-$1000 for 5 days.
0 votes Thank Flag Link Mon May 13, 2013
Seriously? Bribing the seller's agent? Money in envelopes? Are we forgetting being ethical? No inspection? That could be costly.

If your buyer doesn't have enough money, look for a property he can afford. Of course there will be bidding wars on low priced properties since they are so rare nowadays especially if they are in good shape.
0 votes Thank Flag Link Mon May 13, 2013
In addition to puting more down on the property also pay for all of the misc fees and never ask for money for closing. If you pay for title, survey, etc. along with removing contengencies the seller will bet more and your deal will look better. Asking price is only one part of the deal.

Good Luck,

Chris Hutchinson
REALTOR®
The Michael Group
972.809.0607
http://www.chrishutchinsonrealestate.com
0 votes Thank Flag Link Mon May 13, 2013
How about no option period and no contingencies for inspection, appraisal, or financing?

Higher earnest money, higher option money, short closing time, free lease back to seller, $1000 moving expenses to the seller. Dinner delivered with contract, flowers and wine delivered with contract. Be creative.

How about $100 bill for the seller's agent and the seller in an envelope.
0 votes Thank Flag Link Mon May 13, 2013
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
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