I hear many of my buyers saying, “We really like the house, but we don’t want to get into a bidding war.” I know many buyers don’t want to hear it, but in this market, if you want to buy a house, you need to throw your hat in the ring and “play the game.”
I have a theory about buyers who have made this statement and I believe it means one of four things:
- They really don’t want to buy a house.
- They are using this as an excuse because they are scared to pull the trigger to buy a house.
- Pride is a big deal for them and “losing” the war just isn’t acceptable.
- The buyer feels like he/she is not in control of the situation, making it very uncomfortable and easier to not even make an offer to “show the seller” that they are in control.
MARKET UPDATE – This is a bit of a new market. There is no longer a standard for what is happening in Sonoma County. Yes, sometimes there are multiple offers AKA “bidding wars.” Sometimes properties are getting no offers for several weeks. Sometimes there is just one, lonely little offer. And we are seeing a ton of price reductions!
I recently had a home listed in Sebastopol, which by all standards is considered a “hot” market – low inventory and high demand. We put a reasonable price on the home. It was immaculate and showed extremely well. All comments from visitors and agents alike was that it was going to go fast and likely with multiple offers. After talking with several agents with interested buyers, I expected to get three to four offers for my sellers to choose from. When our offer date came and went, we had zero offers! How could this be?? We finally did get an offer, which was over list price and thankfully, all went well. I talked to one of the other agents and asked why they didn’t end up writing an offer and she told me, “My buyers didn’t want to get into a bidding war!” Hmmm, well had they thrown their hat in the ring on the first round, they could have been the one and only offer and gotten the property!!
I spoke with an agent this week about a house she had listed in Santa Rosa. It was the offer deadline date and I asked her how many offers she ended up with. Only one! She too was expecting three to four offers after talking with several agents. The home was priced VERY well and was in great shape.
If you are one of these Bidding War Phobic Buyers, here is my recommendation:
I recommend talking with your Realtor about some strategies for being victorious in the fight. Often times an offer is not always about price, it is about the terms that go with it. There are several ways to make your offer more attractive than others. Also know what your top price is that you are willing to pay for a particular property, and have your Realtor help you to make your offer accordingly, with a strategy in mind. If it becomes a bidding war, you can gracefully step out because you knew what your limit was. Of course, the seller may come back asking for a couple thousand dollars over what your top price was, and you will have to decide if you are willing to walk away for an amount that will barely be detectable in your mortgage payment. Have your loan officer do the math for you! You might find that what the seller is countering you for only costs you $10-20 more a month. If it’s a house you really want, it may be worth a little extra and maybe you will be skipping the Starbucks line for a while.
When buying a house, we make compromises and sacrifices. That is if you REALLY want to buy a house. Will it be your absolute dream house? Likely not, no matter what your price range. There will always be something that is missing from your checklist or that isn’t quite perfect. If that is what you want, be prepared to have a lot of money and a lot of time to build your own custom home. You have to be willing to make some compromises and pull the trigger, no matter how scary and intimidating it is! And TRUST your Realtor!
So, to recap…. as a buyer, will you still run into multiple offers in Sonoma County right now? Yes, they are still happening. But if you are willing to throw your hat in the ring, take a chance and trust your Realtor, you may just come out victorious!