The only thing harder than getting a listing is helping buyers win a house.
Last week I mentioned how there still isn’t any uniform process to sell a residential resale home – it is the wild wild west! Even when a listing agent tells you what they are going to do to you, it is always subject to change!
We found this fantastic video by a Colorado guy who outlines the best ways to handle a bidding war. Because I know that hardly any agents actually have a bidding-war strategy beyond spreading out the offers on the dining-room table, I have since been sending the video along with my offers. Because the video is done by a third-party guy, hopefully it is viewed as a powerful new solution by agents who tend to think they know it all just because they’ve sold a few houses in their life.
Here are my results:
- The first listing agent who saw it took it well – he was the guy who asked if I utilize the same method (which I affirmed), and then proceeded to at least tell me what the other offers were. They were too high for us, so my buyers surrendered.
- The next try was to send the video along with our full-price offer (different buyers) into what we knew was going to be a dog fight. There were at least 50-70 people at the open house when we were there, and the older house oozed with charm and character. The listing agent insisted that to present our offer, we first had to state in writing that we would not ask for any repairs. I replied that I’ve never heard that one before, but we complied just to see how crazy it would get. She didn’t respond to my second inquiry on whether she watched the bidding-war video. She said they would pick a winner on Monday, which came and went with no seller response. On Tuesday, she emails the buyer-agents stating that she had double-digit offers, and wanted everyone to submit their highest-and-best offer. Obviously she didn’t watch the video – in which he compared her strategy as being the same as telling race drivers to just keep circling the track and we’ll tell you when the race is over. My buyers loved the house on Saturday, but by Tuesday were fed up and we didn’t respond further.
- On Monday afternoon a new listing hit the MLS which looked like a good match for a third set of buyers, and we were there on Tuesday morning to view. It met our criteria, and we knew it was hot, so we made a full-price offer that day with no appraisal contingency, no termite, no home warranty, and a month’s free rentback for the sellers if they needed it. The next morning, the listing agent said he had received four offers in the first 24 hours – and ours was the lowest! He watched the video but it was too late – the sellers had already signed the offer that was $50,000 over list.
Wouldn’t every party be better served if there was a uniform process?
Wouldn’t a live auction be the best solution for sellers and buyers? It would take all the uncertainty out of the equation, and allow all bidders to compete face-to-face, and be driven by the animal spirits to pay what it took to win!
A side note, and fourth example: Buyers who are moving here from out-of-state put their current multi-million-dollar home on the market last week in a town that has had a similar frenzy environment as San Diego. They were impressed with the immediate buyer traffic, and on Sunday an agent reported that he had a buyer who wanted to make an offer. He, like me and every other buyer’s agent, was inquiring how the listing agent was going to handle the process, to which she responded, “We’ll be reviewing all offers on Wednesday”. The buyer didn’t like that response, and went away. Here we are on Thursday, and no offers have been received.
While I need to keep getting listings just to maintain my own sanity, I will always have time for buyers who are blog readers here! Congrats to our frequent commenter Eddie89! We made offers on five houses before finally succeeding on the sixth. We offered 9% under list price – a daring low offer on a new listing – and when the sellers countered 3% below list it was close enough – we’re in escrow!