There are more houses that aren’t selling, than those that are.
In a frenzied marketplace, how do you know which are the good buys?
It’s easy – the babbling listing agents will tell you.
I always contact the listing agent and ask, “How many offers are in?”. Their answer will tell me how well their list price reflects the opportunity.
Here is my guide for their answers:
- 5+ offers – it’s a good value, and at least one great agent has offered.
- 1-5 offers – retail priced.
- No offers – overpriced.
Because there are no rules or regulations for bidding wars, once we hear that at least one offer is in, we know that it is time to act.
Many agents are specifying in their confidential remarks when they will be presenting offers and/or showing the property, but don’t trust it. If they get a good enough offer, they might just take it to end the chaos.
Could a listing agent be lying about the number of offers? Maybe, but it takes a slick operator to pull it off. The good listing agents know how to put the right price on a property, and as a result, they will get multiple offers. The good buyers’ agents know a good deal when they see it too.
The listing agents to watch are the ones who tell you that they have had “tremendous activity”.
I had one last week tell me that she didn’t have any offers yet, but I should “rush” my offer in because of the “tremendous activity”. Why? If so may buyers have seen it, how come you don’t have any offers? It must be overpriced!
The most-motivated buyers see the new listings within the first day or two on the market – they are the ones that are willing to pay top dollar, and if they passed on it, then what does that tell you?
In this market, if 5-7 days goes by without any offers, be suspicious of the price – and know that the showings drop off considerably after the first week.
Why do we see houses selling after a month or two without lowering their price? It’s because the market caught up with them, which is happening in places like the under-$1,000,000 market in Camel Valley. In the 92130, there are only 15 houses for sale under $1 million, and only six of those have been on the market longer than 30 days. There are 41 pending/contingent.
In areas like that where there is no glut building, buyers are feeling nervous that they don’t see more homes coming to market, and they are jumping on the OPTs.