I admin it. I’m frustrated.
“Tell them to not even bother,” said the listing agent apologetically about my first-time home buyers. “There is simply no way they can compete.”
He and the Sellers figured the home was priced “about right.” And it was… the list price WAS right. The house won’t appraise for any more. They certainly weren’t expecting 26 offers. Most were over asking. Most had removed their appraisal contingency. The best was an all-cash offer about 10% over the asking price.
I’m not going to give away the address out of privacy concerns for the Sellers and even the other bidders. But, there are only a handful of available homes that it could have been.
My head is spinning. 26 offers on an underpriced house is still a lot, but at least it makes sense. 26 offers on a fairly-priced house is insanity.
- There are at least 26 serious buyers in the Pleasanton-Danville stretch up to $700,000, with just about nothing for sale. They’ll be competing on every decent listing.
- If this home sells for the price I was told, that represents a full 10% over what it would appraise for.
- And, probably a full 15-20% more than it would have sold for 3-6 months ago.
- Meaning that lower-end homes in this area (maybe $500-750K) are appreciating at a 30% per year pace.
- There were multiple all cash offers over asking price… how can a fha/va or even a 20%-down buyer compete without overbidding even more? Then covering the appraisal shortfall with cash. What if they don’t have $50,000 to spare?
The next steps for us will be to maybe lowball some higher-priced homes that have been sitting for a while. And I’m going to try and find sellers who cancelled their listings last year without selling. Maybe some of them would reconsider.
This is worse then 2004. The housing bubble is re-inflating quickly.
If you’ve been considering selling, call me today and let’s discuss how you can take advantage of all of this madness.