Competitive bids on real estate....

[I-Hate-Hulse]

So, I'm about to head into the dreaded "competitive bid" situation tomorrow on a new place. Anyone have any good tips on how best to win this?

Someone mentioned a stupid yet what they thought was effective, out bid by some stupid little amount, like $100,001 (assuming conditions were similar). Not sure if that really makes a difference. Might even PO the seller IMHO.

Should I go in with my "all in" amount or keep some in reserve? I might not get a chance to counter right?

Forget waiving property inspection, the place is from the 80's. I've got to have one. Could probably waive the financing one, mortgage shouldn't be a problem, and bridge financing should be a problem as long as I move my current one.

Man this sucks.

[photon]

Yup, it's crazy right now.

One strategy I've heard is to sign a blank offer with your agent and work out what your maximum is, and have them take it to bid competition time and basically say "what number do I need to put here to make this deal?". If the number is below your max, then great.

I would go in with your strongest offer and if you can arrange it have a super short time to waive conditions (ie have the inspector ready to go), but yeah you'll probably go up against unconditional offers. Be flexible on the other stuff to fit the seller's needs (like posession date).

Risking an unconditional offer on a revenue property is one thing, but I wouldn't do it for a place I want to live in; there's nothing more stressful in your life than having problems with your home.

[teamchachi]

Just talked to my realtor, who probably buys and sells more real estate than 95% of the realtors in town. She was saying that most offers don't have conditions. If there are multiple offers, and any of them have conditions, then you can be sure that the conditional offers will go in the garbage unless they are obscenely high.

[I-Hate-Hulse]

Originally Posted by photon

One strategy I've heard is to sign a blank offer with your agent and work out what your maximum is, and have them take it to bid competition time and basically say "what number do I need to put here to make this deal?". If the number is below your max, then great.

Yeah, but don't all bidders show up to present offers right then and there, thereby taking away any potential to find out what the other side is offering and revise your bid? I seem to think I have a one shot deal here.

If I go in with my "all in" price and I lose, I won't feel too bad, as it's a crazy amount for me and it's already about 10K more past what I thought my maximum was.

Teamchachi: Yeah, I've heard that too but to pass on a physical inspection.... having served time on various condo boards... that's something you'll never want to do. Ever see the Tom Hanks movie, the Money Pit? Losing may be a blessing in that case.

[habernac]

Originally Posted by teamchachi

Just talked to my realtor, who probably buys and sells more real estate than 95% of the realtors in town. She was saying that most offers don't have conditions. If there are multiple offers, and any of them have conditions, then you can be sure that the conditional offers will go in the garbage unless they are obscenely high.

and anyone who goes into a real estate deal with no inspection is crazy. I'll wait as long as I have to (we're shopping right now too). Doesn't really matter to me if prices keep going up. That means mine goes up as well.

Looked at a decent place the other day, we were ready to make an offer, our realtor checked the selling prices in the area of similar sized homes and this one was wayyyyy overpriced. I still may make an offer, but it'll be $20,000 less than they're asking. I'm patient enough to keep looking until we get a decent deal.

[habernac]

Originally Posted by fotze

Habernac, has the realtor tried to push you into buying anything? I have gone through many in the past cause they tried to force me to buy the house.

Nope, quite the opposite really. He's a good friend of my brother-in-law. He's told us he doesn't care if we have to see 100 homes, he'll get us the perfect one for a decent price.

[I-Hate-Hulse]

Originally Posted by habernac

Looked at a decent place the other day, we were ready to make an offer, our realtor checked the selling prices in the area of similar sized homes and this one was wayyyyy overpriced. I still may make an offer, but it'll be $20,000 less than they're asking. I'm patient enough to keep looking until we get a decent deal.

That's exactly what happening to me right now. Absolutely ridiculous asking price, a real "shoot out the lights" kind of price. Factor in comparables from a couple months ago, add 10%, and you STILL don't even come close to their asking price. It's definately more than a little aggravating if you're a logical person, trying to deal with an illogical market.

It's worse because the other bidders were brought in from the seller's agent. Although they'll bring in an "impartial" 3rd agent from the same agency, I can't help but think they'll do what they can to keep the comissions in the same agency and screw me over. Honor amongst thieves....?

I like to consider myself a good and thrifty shopper, but watching my "all in" price spiral up reminds me of the spinning odometer on a Telethon, getting bigger, and bigger.

[photon]

It's not so much honour among theives, it's more there's 5000 agents working on 1100 properties trying to make a living. And people are squeezing agents and going to sale by owner sites.

In many cases it's cheaper to build a new place right now than it is to buy a pre-owned place. Average new home price in Calgary was $20,000 LESS than the average resale price!

[troutman]

Get the advice of a realtor. When you are the purchaser, you have no commissions to pay.

[Mike Oxlong]

Have you tried searching welist.com or comfree.ca?

Although these sites are gaining in popularity they still don't get the exposure that a house gets when it is listed on MLS. Generally the houses for sale by owner don't get into the bidding wars that a lot of houses on MLS get into.

Also you get a chance to talk to the owner of the house without a realtor in the middle. You can find out from the owner what some of his "hot" buttons are and try to tailor your offer in a way that is most attractive to the seller. Maybe price isn't his biggest issue, if you can be flexible with possesion date, or some other factor that is important to him then your offer might be the most attractive. Plus if he isn't paying any Real Estate commisions he might be more flexible with price.

[Ironhorse]

I feel your pain. We were successful recently in purchasing a new (to us) home, and dealt with the anxiety of finding something to fit our needs and the ridiculous pricings; there's not a lot out there to choose from, and there were line ups to see some of the homes (hopefull that will happen when we go to sell ours ).

As a side note, are there any real estate lawyers here on CP? Gonna need a (reasonable) one in a month or two...

[troutman]

Originally Posted by Ironhorse

I feel your pain. We were successful recently in purchasing a new (to us) home, and dealt with the anxiety of finding something to fit our needs and the ridiculous pricings; there's not a lot out there to choose from, and there were line ups to see some of the homes (hopefull that will happen when we go to sell ours ).

As a side note, are there any real estate lawyers here on CP? Gonna need a (reasonable) one in a month or two...

Send me a private message, and I can explain our "double secret" service for calgarypuckers.

[Crazy Flamer]

My girlfriend and I bought a house about two weeks ago. Our realtor told us that usually, the highest bid wins, even if there are conditions. The thing about conditions is that you have to be able to waive them quickly.

For example, we bought a house in tuscany on Tuesday, subject only to financing because the place was only a year old. But in the offer we put that we would have the financing condition waived by Friday (three days). They accepted.

Also, be careful that you don't bid too much on a house. In order to get a mortgage, the insurance company, CHMC, will have to see that the house is actually worth that much. So if you put a bid on a house for 350,000 and CMHC comes along as says its only worth 330,000, then your mortgage can only be for that amount. You can still purchase the home for 350,000... if you have an extra 20 grand in the bank.

And lawyers, DAMN they are expensive. Any real estate lawyers that want to give me a quote please do, because I'm going to need one in the next week or so.

[Bobblehead]

Geez troutman, with all the business you are getting from this forum you should top off the Server donation and write off the cost as a business expense!

[Crazy Flamer]

Originally Posted by fotze

CAn't you read?

I guess not!

Actually I saw that post after I poseted mine. All taken care of!

[tvp2003]

Another PM coming your way troutman

[looooob]

i hope this man has an unlimited inbox, because I may be pm'ing him as well...

[troutman]

Originally Posted by Bobblehead

Geez troutman, with all the business you are getting from this forum you should top off the Server donation and write off the cost as a business expense!

Well, "evening with troutman" did raise $400 for calgarypuck.

I'd be willing to make that an annual event.

Also, I would consider further supporting calgarypuck, by advertising on the site. Moderators, please contact me . . .

Thank you for your inquiries. It has been a pleasure getting to know and work with you.

[Bertuzzied]

UGH! i was trying to buy this duplex in Varsity for $450k about 2 months ago. Figured if i offered $30k over the asking price i should be able to get it. It sold for $550k!! with 20 offers. I didn't even make it into the top 15 offers.

I felt like the Flames on draft lotto day. hehe.

[photon]

Originally Posted by troutman

Well, "evening with troutman" did raise $400 for calgarypuck.

I'd be willing to make that an annual event.

Also, I would consider further supporting calgarypuck, by advertising on the site. Moderators, please contact me . . .

Thank you for your inquiries. It has been a pleasure getting to know and work with you.

PM sent