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BIDDING WAR. Again? In a buyer's market?

By Pacita Dimacali

Real Estate Agent with Alain Pinel BRE 01367196

April 09, 2009 05:04 PM

It's a bidding war. True or false?

According to HeraldTimesOnline.com, "Buyers' market seems imminent". And Washington Post says, "In a Buyer's Market, the message is: fix it, or else."

Didn't we say this is a "buyer's market" and "prices have come down". NOT! At least, not in this case.

A really nice cottage came on the market in Alameda CA last Friday. I was the first to show it. And no sooner were we getting out of the house, there was a line of agents and their buyers outside the door.

During the open house Saturday and Sunday, the place was mobbed.

It's a bidding war! By Monday, there were several offers. More people said they would write, but passed when they were told they shouldn't write for less than list price which is what some buyers hoped to do.

So why are we bidding up? The property was really clean, was staged well, and the seller completed a lot of repairs. So it was a very "clean" property with a very low pest report.

Yes, it was priced aggressively. And yes, we knew it is going to sell quickly. Why? It's a detached single family house listed at $499K. Why is that important? It's under $500K!

Multiple Counter offers later, my client's offer was accepted. She is thrilled beyond words. And I am just as thrilled as she is.

True Market Value So this brings us to the true test of market value: it's whatever the buyer is willing to pay for it.

Or in InvestorWords.Com's Definition
The price that an interested but not desperate buyer would be willing to pay and an interested but not desperate seller would be willing to accept on the open market assuming a reasonable period of time for an agreement to arise.

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Lynda Eisenmann

Preferred Home Brokers - Brea, CA

Broker Associate ,CRS,GRI,SRES, Brea,CA, Orange Co

Hi Pacita,

Sounds like that place had everything going for it.

The other day I sorted through 30 properties, (all showing active) after calling on each, 20 had offers in the works. Tonight I wrote an offer on a new listing as of yesterday, we were the 3rd offer on that one and offered over asking.

Apr 09, 2009 05:11 PM

Shawn Murray

Omaha, NE

AS I have always said, if you price it right they will come. I just turned a listing because the seller wanted $30,000 more than what the CMA was telling us. I was the third of four ( they told me I was the last one they were interviewing) so I thought that I was positioned well in the pecking order. When I told them what they needed to know, their jaw about it the floor. The other two agent had told them it would sell for $30,000 to $40,000 more than mine came out. Now I can see a few thousand but come on now. These truly agents out to buy the listing. Sorry I do not do that.

Apr 09, 2009 05:18 PM

Pacita Dimacali

Alain Pinel - Oakland, CA

Alameda/Contra Costa Counties CA

Lynda, my friends Antonio and Alexia Cardenas encountered this situation that they blogged about: 60+ Offers Presented, Would YOU Write # 61...? What Are Your Chances?

Then they mentioned another one that had 30 plus!

Apr 09, 2009 05:24 PM

Shawn,

But what is the strategy is to price it aggressively, just a tad under market price, to generate attention? In this case, it did!

So maybe you can tell your prospective clients that it's better to be within a certain price range in order to attract the biggest and widest pool of buyers.

Apr 09, 2009 05:26 PM

Mark Hall

Realty One Group Cascadia - Vancouver, WA

Homes for Sale Vancouver Washington

The Alameda house probably fell under the 5/5 rule. The top 5% in condition and the bottom 5% of the price range. Unfortunately my sellers don't seem to understand this theory.

Apr 09, 2009 05:32 PM

Pete Xavier

Investments to Luxury - Pacific Palisades, CA

Outstanding Agent Referrals-Nationwide

Pacita, Good job finding this great Alameda, California deal for your client! Regards,

Apr 09, 2009 05:38 PM

Mark --- what will it take to convince them? There is a DVD available from our California Association of Realtors that addresses preparing your house to sell. I bought several of these, and wil l give a copy to a seller who needs to be convinced. Maybe your association offers it, too?

From our CAR website. Cost is $11.95 each

View Large Image

DVD2005
123 Sold Home Staging DVD

Does your new listing need some sprucing before it is ready to place on the market? This valuable tool can help! Motivate your sellers, and gain their confidence.

An 18-minute DVD that guides the homeowner through the process of preparing their home for sale. A great giveaway or loaner to share with sellers. Adds value to your listing presentation and sets you apart from the pack.

Apr 09, 2009 05:45 PM

Pete --- thanks. It was a battle, I tell ya. My client has written an offer on another property but was outbid. And I told her that perhaps the reason why she didn't win that one is because there's another home just waiting for her. And here it is!

Apr 09, 2009 05:47 PM

Winston Westbrook

Westbrook National Real Estate Co - Victorville, CA

Congrats on winning that bidding war. I'm sure your clients are very proud of ya. Good luck in all you do.

Apr 09, 2009 06:50 PM

Sally K. & David L. Hanson

EXP Realty 414-525-0563 - Brookfield, WI

WI Real Estate Agents - Luxury - Divorce

Price it right and they will come...and buy...! The trick here sometimes are the appraisable comps that make the financing a smooth ride...good luck !

Apr 09, 2009 11:05 PM

Winston -- thanks. But it's not over yet. I am praying that the powers that be (appraisers and underwriters) will see what we saw in this property.

Sally and David --- I'm really happy to see the movement. A lot of the buyers are making their move...at the same time and towards the same properties, it seems.

Apr 10, 2009 04:59 AM

Kathleen Daniels, Probate & Trust Specialist

KD Realty - 408.972.1822 - San Jose, CA

Probate Real Estate Services

Pacita - We are definitely seeing bidding wars in my area - predominately in the bank-owned market. It seems like buyers are focused exclusively on bank owned because they feel that is where the better deals are. It helps when a home is priced right.

Apr 10, 2009 03:01 PM

Kathleen

I have just finished writing an offer which I thought would be a pre-emptive one since the listing is "coming soon!" Little did I know....it's another bidding war! And this is a regular sale, too.

Apr 13, 2009 06:16 PM

BIDDING WAR. Again? In a buyer's market?

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