I’m reposting this from my general purpose real estate blog, “The Gory Details“, because, though it’s not specific to Mount Carmel real estate, it’s a good read for what’s going on out there in the market.
Ok, now this just sounds insane. Or maybe I should have started it as “I never thought this would happen to me, but…” (echoes of Seinfeld’s Kramer reading from Penthouse Forum).
It’s mind boggling, but the notion of multiple offers – particularly on the lower 1/3 of the market here in the Bay Area– is as prevalent now as it was 3 years ago. Now granted, the affected market segment is much more specific – I don’t really see this happening much on the higher end of the market (above $900K). But now that lending has thawed a bit from the catatonic state it was in Q4/’08 and Q1/’09, there are a TONS of investors and first time home buyers that are scooping up homes once priced in the $500K+ range which are now priced in the $200K-300K range.
There’s a huge “dang, this is a bummer” element for any agents like myself, representing buyers who keep getting outbid, or beat to the punch by others making offers on homes the day they come on the market. It seems like in Q4/Q1, that a home would come on the market, and the buyer mentality was “I’ll just wait 2 months, and they’ll be lowering their list price”. Let me opine here, that mentality is as long gone as Dick Cheney’s sanity. My recommendation to any buyer out there is this: if a home seems priced ‘right’ (totally subjective), don’t wait to make an offer on it, because chances are someone else will. Oh, and making lowball offers? Don’t even bother, as the window where you could go into contract offering 10% or more less than the list price has pretty much shut for good. Lowball offers? You might as well just stand on the rooftop and say “I don’t really want this house.” Don’t try it, as that train left the station in Q1.
So back to the 89 offers.
Ok, so I (representing a buyer) present a good, slightly over asking price offer on an REO (bank-owned) home in South San Jose. Couple days later, an automated email from the listing agent comes back saying they’re doing a multiple counter-offer, to ALL of the 72 offers they received. I go to check the Listing Agent’s listing updates on Twitter, and they now have 89 offers. I wouldn’t make that up if I tried. Eighty….nine…offers.
I then picked up my jaw from desk upon which it hit….
Now here I venture to my geek side – this now, is actually a pretty good application of Twitter to real estate. Many of these foreclosure-specialist listing agents have 20, 30, 100 listings – all foreclosures – they are juggling all at the same time. Updating status on each listing in MLS with this amount could be a time-consuming task. Using Twitter, the agent gives to-the-minute updates on if offers were submitted to the bank, if they’re in counter-offer with a buyer, if they’re taking no more offers, etc. – much more useful information that could be gleaned from the “Notes” section in the MLS.
But back to this multiple offer topic. No matter what you read, the market in many instances in the Bay Area, is showing PLENTY of signs of life. Yes, things slowed down early in the year, as did almost every micro-market in the world. But even in price points between $800K – $1.3M, there are homes that are going in to contract within 2 weeks of coming on the market. It’s becoming less and less of an anomaly. If a house is priced right based on its location, it will sell.