Having multiple offers in this current market place is extremely common if your property is priced right. Properties being put out on the market that are overpriced to begin with will typically not even generate that much activity. So how do you really know if your property is priced right and that you are obtaining the true market value? Comparable sales commonly referred to as “comps” are still the most reliable source. It is very important to compare “like kind” properties preferably within a quarter mile radius of your property in order to make accurate comparisons. This is very difficult as the current number of sales still remains very scarce which makes comparisons of similar properties if any, very limited. This is a current industry problem for lenders and appraisers and will remain this way during a strong seller’s market. This is “good news and bad news.” The good news relates to supply and demand, low supply, high demand; the bad news, try getting a lender to lend the maximum loan to value when lenders remain scratching their heads and sharpening their pencils while justifying the actual value. Typically, determining a property asking price will be close to current sales of similar properties in the neighborhood with an added increase in the asking price to allow some room for negotiation. Once on the open market with full exposure, the value of what the property is worth will be dictated by the marketplace. The MLS (Multiple Listing Service) is still your best source for marketing exposure as it brings in not only the local brokerage community but brokers from other areas and is also posted on the internet. Offers coming in over the asking price can heat up the activity on the sale and can even generate additional over asking price offers. Some of these buyers will actually perform, they may need the property for exchange purposes and may be desperate to find their upleg before their time runs out and may be willing to overpay just to avoid the tax consequences. There are some buyers that are just desperate to get into the market at any price as they may have lost previous properties in bidding wars. Then there are the multiple offers that just feed on themselves and when it comes right down to it, these sales just don’t happen because they were overpriced to begin with. This trend is very difficult for sellers. Naturally, you want
to obtain the best price but the best price is not always the
highest price offered. The best price is still the one with a
“real” buyer who is willing, ready and “able”
to close under the best terms, conditions and time period that
accommodate the seller’s criteria. It is so easy to get caught
up in the frenzy of multiple offers and lose prospective of what
your real sales criteria is. Perhaps, it’s just the alluring
seduction of these great prices and you’re simply not a “real”
seller in this marketplace just as some of these multiple offer
buyers are just not “real” buyers. While the current
market inventory of properties for sale may be scarce there still
remains an inventory of overpriced properties that continue to
sit on the market.
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