Aspiring home buyers who are looking for a steal are out – the sellers are no longer accepting lowball offers. Instead of using the original offer as a negotiation tool, buyers are often surprised when the response to their low offers is a flat-out “no”.
So what offer is considered too low? As a rule of thumb, sellers can consider anything below 90% of list price a low offer – very different from a buyer’s viewpoint of below 80-85% of list price. Gone is the 2008-09 market with desperate sellers, and buyers who are still looking for those ‘steals’ are out of luck.
Consider a local home in Chandler, AZ – within a weekend, 17 offers were submitted from very eager buyers looking to grab a home in a market with very little inventory. The offer accepted was $16,000 over list price – the vast majority of buyers were rejected without ever being sent a counter offer.
As well, buyers who are taking the time to consider if a home is right for them are also starting to miss out on the homes they are interested in. Sellers are often receiving multiple offers within the first couple of days on market – some even on the first day – and buyers who want to wait are seeing the homes get under contract before they even have a chance to see it.
That’s not to say that good deals are not available – the Phoenix Metro area offers some of the most affordable housing in the country. And while our housing market has appreciated 20% year over year, the home prices are not close to touching what the values were during the boom.