patrick.net

Asking prices should be eliminated :)

Make an offer and bid blindly with others. That will increase their success rate and finding a true sucker. That's the job of the seller agent anyways, of course, with the help of a buyer agent.

yes, lets make a law that tells a property owner how he can sell his property. Lets tell him:
1. you can't have a listing price.
2. you can't keep offers private.
3. you can't tell people you have multiple offers...

I'll just go shred the constitution now...

azrob .... get used to it. For the most part with very few exceptions, these people live in La La Land and think the world should operate according to their silly fantasies. They pretend to know how the real estate business works, but show through their comments that they don't have a clue. It's not only real estate, they typically hate all business. This site is a microcosm of opinions held by too many Americans in which business is always evil, government is always good. I hope I'm wrong because if I'm not, we're in very deep trouble and the hour is very late.

RayAmerica says

azrob …. get used to it. For the most part with very few exceptions, these people live in La La Land and think the world should operate according to their silly fantasies. They pretend to know how the real estate business works, but show through their comments that they don’t have a clue. It’s not only real estate, they typically hate all business. This site is a microcosm of opinions held by too many Americans in which business is always evil, government is always good. I hope I’m wrong because if I’m not, we’re in very deep trouble and the hour is very late.

Well, luckily for you, you're wrong. (again)

ptiemann says

Vain says

Asking prices should be eliminated

Make an offer and bid blindly with others. That will increase their success rate and finding a true sucker. That’s the job of the seller agent anyways, of course, with the help of a buyer agent.

interesting concept. I think buyers know the value best anyways.
Past December I was getting ready to sell a house and my realtor had already put his sign in the front yard. But we had not really decided on the listing price yet. We were toying with 289k or 299k to induce a bidding war, or list a bit higher like 320k and possibly give cash back at closing.
There were contractors working on the property and someone drove by and peeked in.. made an unsolicited offer of 310k. FHA which I could not accept at that time. So I listed and long story short, last month I finally closed escrow for 311k
It fell out of contract twice, the appraisals were 300k and 320k, and one offer was as high as 350k, but in the end, it sold for ($1k over) what the first buyer guessed to be the right price.
In total there were 12 offers on this property, but not all in one day.
Reasons why I support the idea of removing asking prices:
- short sales sometimes list ridiculously low just to get activity.. will never be approved at that level, but giving buyers the wrong idea of what the going price is
- truly uninformed/ unmotivated seller listing for 600k when identical units are selling for 400k

I agree. There should be reform on selling practices. If you put down an asking price, the home should go to the first one with that much money.

If you don't put an asking price, you let them bid blindly, and reject offers that don't meet your standards. Counter offering someone who bid list price sounds stupid to me (REO's do this alot).

>> Fitzclarence: putting offers on multiple homes could set you up to be sued. If two sellers sign those offers, before you rescind one of them, you will be committed to buying both homes. committed as in legally bound to buy both.

No, you can very easily create multiple offers to purchase, each one of them stating explicitly how you will decide which one of the accepted offers to entertain, if any.

For example, the algorithm could be first-come-first-served, or some rank order of preference, or perhaps "we'll look at all accepted offers on Wednesday and decide which one to entertain".

Turning the table on the REIC could be so much fun.

>> good comebacks for ‘we have multiple offers’ ?

Call me back when you are down to zero offers again, and I may buy it for only 5% less than my current offer (If I'm in a good mood).

azrob00 says

Fitzclarence: putting offers on multiple homes could set you up to be sued. If two sellers sign those offers, before you rescind one of them, you will be committed to buying both homes. committed as in legally bound to buy both.
Now, I know from the other thread, you guys don’t need agents, you know everything. However, if that happened to my seller, who passed on other offers to take yours only to have you cancel because you liked your other contract better, you could expect litigation, and a very expensive lesson.
On the original subject, when an agent says they have multiple offers, they almost certainly do. They may be weak offers, low offers, whatever. Without written permission from our seller, we can’t tell you how many or for what amount anyways. So would you prefer the agent tell you nothing? That certainly pisses buyers off too when they spend the time to write and deliver an offer.
Here is what I see on this thread: a bunch of people who are far too eager to buy. You are likely buying way too early, in the eye of the storm so to speak, and will watch prices drop again over the next few years. The shadow inventory still coming is sufficient to tank the market, but rather than do the logical thing, and wait another year or two, you’d rather claim all the agents are lying presently, when presently supply versus demand are not on your side, homes truly are getting multiple offers.

I think most on these threads are holding off on buying, I recently took Patrick's advice and rented a larger place in a nicer neighborhood. Now, I am waiting for prices to slowly drop....yes, they are stable for now but this was also the case in Japan 15 years ago.

Vain says

Make an offer and bid blindly with others. That will increase their success rate and finding a true sucker. That’s the job of the seller agent anyways, of course, with the help of a buyer agent.

That was the exact tactic used by agents in the early 90s. The freaking realtor clowns were so shell shocked that they couldnt figure what actual prices to quote or advertise. This may be the same case, but now they are afraid of being sued where they may lose their RE license and there personal assets.
They are not corporations, and you can go after their personal assets for fraud.

azrob00 says

yes, lets make a law that tells a property owner how he can sell his property. Lets tell him:
1. you can’t have a listing price.
2. you can’t keep offers private.
3. you can’t tell people you have multiple offers…
I’ll just go shred the constitution now…

Its not that much different from what the goverment did with Corporations and Accounting Firms with passing Sarbanes Oxley in the aftermath of Enron and Worldcom. Did the Constitution get shredded?No. This is a question of proper quality control which would have avoided the easy lending and boom in toxic ARM loans and all the fraud which it spawned.

One has to ask does one see 'multiple offers' on rentals ? Do you hear that from your landlord, I have other offers will you offer higher rent payment ? There are sharks out there, and that 6% commission is fixed, while everthing else to increase profits are wide open.

When i bought my home years ago and many others i know never had 'other multiple offers, will you go higher'. Its all fraud!

Yeah, that is why there are right now some 35,000 homes on the phoenix mls that don't have a single offer on them...21,000 with over 100 days and zero offers...

Most homes don't have multiple offers; Pick the home that is priced for 100K when all the similar homes are listed for 200K and guess what, THAT home will get lots and lots of offers...

As for rentals, same thing. The last time I advertised my one remaining rental on craigslist, I had three parties show up to rent it at the same time, and they bid it up by $50 a month, even in this poor rental market.

If a home doesn't have an offer on it, an agent is very unlikely to say it has multiple offers, for the simple fact that most people will not bother writing one in that case. One offer is hell of a lot better than none. I call agents all day long asking if they have any offers, and 90% of the time, the answer is no. Sometimes the answer is yes, but its not a very good offer, once in a while it is multiple offers. I have yet to see any evidence of lying.

Believe what you want, I've never seen a bigger group of clueless people who want to think they know everything then on here.

Most parts of the bay area are no where near done correcting, so let the multiple offer homes sell and wait. go read dr. housing bubble, l and quit arguing against reality, the buying time will come, and nobody will be saying "we have multiple offers" then, they will be saying "please give us an offer..."

azrob00 says

Believe what you want, I’ve never seen a bigger group of clueless people who want to think they know everything then on here.

...and yet you're still here. Why, if you're so much smarter than we are?

I am located in the Sacramento area and have observed some of the many ways MY REALTOR Friends pump up the numbers. From flat out lying to other techniques. Here are a few---that are very commonly used most everywhere:

1) Have the seller submit phoney information to ZILLOW- that show "upgrades" that never took place. There is minimal work done using paint and other CHEAP COSMETIC touchups. They than file lien on the house for bogus upgrades from a bogus company at a bogus high price. A month later they sign off the lien and it is removed. The alleged firm is usually in Mexico. This covers the seller and listing broker, when the house starts falling apart. I Know nothing about construction--ius rthe refrain -read the contracts. This scam set up by the Realtor listing the property. It helps build comp values. So they just put in 75k of upgrades---B.S! I have seen this.

2) The deposit is not made using a cashiers check or personal check. IT IS A PHOTOCOPY of the check---Listing Realtors say is "just as good" Lie lie and LIE. In fact there is NO MONEY IN THE DEPOSIT...

what about liability? EASY---there are subject to's , contingencies or requirements that NO ONE CAN MEET. SO they would not qualify for the loan no matter how high or low the bid is.

Example---subject to owner replace back yard landscaping and add 350000 gallon in-gound heated and enclosed swimming pool with side jacuzzi with ten year gaurantee against defects and 5 years swim pool cleaning contracts.

3) Pocket listing----hide and play shell games with the address.

Investor90, interesting to hear, but the part about filing a lien does not make sense to me as written above.

It is the contractor that did work (fake work or otherwise) which is in position to file a lien against the house/property. Are you saying they are using strawmen to file a fake mechanics lien to generate a fraudulent paper trail of non-existent upgrades that supposedly have not been paid for?

So I don't have a short one-line comment, but in this situation I demand that my realtor put in a low realistic offer. At least I know that they are working for me!

Since you claim this as an investment, can I see your securities license?

I have to say that I agree with azrob. When you guys go buy a used car, do you expect the dealer to tell you exactly what he paid for it? Or what the current market price is for that make and model?

Come on--it's not that hard. Do your research, come up with what you value the house at and bid low enough that you still have room to negotiate and remain below the number you think the house is worth. Whether there are 0 bids or 100 bids shouldn't change a thing. You bid what you think the house is worth--and no more. If you choose to raise your bid above what you think the house is worth, it's not the realtor's fault--it's YOUR fault.

In 2000 I was selling my home as a FSBO and had general interest from a few buyers. But it dragged on and I listed the home for two months with 5% added to cover the commission. The listing contract excluded all of the FSBO visitors and I notified all of them that they were excluded from the listing contract. I continued trading emails with two FSBO buyers until one of them lost one income and dropped out. Near the end of the two-month listing contract, the agent called with an offer, which was below my latest FSBO offer after his commission. He called back that same day with a full list price offer, which I accepted - it gave me several thousand more over the FSBO offer.

The FSBO buyers were willing to go higher but I took the agents offer, expecting his help in moving the deal to closing. Big mistake; he all but disappeared, leaving me to handle the buyer's home inspector visits and several other questions. But it did close at the full list price. Later I learned he had lied to his buyers, letting them believe they were competing with another agent's buyer.

In buying and selling six different homes, I have met only one truly qualified RE agent; even he was playing games but lived up to his word when pushed.
RCharles

We said "no our offer stands as is, along with its deadline" when told to submit our "best and final" because there was a competing offer for the house. They caved and we got the house--without blindly handing over another 5-10K. We assume either the other offer didn't exist or was less all along.

A friend of mine put his house up for sale recently. They received multiple offers - and were selling FSBO. The realtors who submitted offers were condescending asses who insisted that before they submitted the offer my friend sign an exclusives sales agreement. He didn't.

He called the people who said that they were interested in offering and told them that the sales price was solid, it was first come/first served and that if they were going with a realtor they would have to pay the commission above and beyond the price he was asking. A realtor told him he'd never sell that way and would be blacklisted by the local NAR.

He ended up getting his sales price plus $10k, their buyer's commission was added above the price, and the buyers were happy. The realtor who had threatened him was not - it was a case of him having to be right, not him having to sell the house. That realtor actually tried to get the name of the buyer's agent to get him to back out.

I realize that Realtors believe that they're necessary. Sometimes they are, like when a person can't show the house themselves 'cause they live out of town. But the sellers still have to do alot of work and the realtor doesn't do much. IMHO, of course.

I recently saw a good deal of rotten behavior on the part of listing agents, on the property I purchased recently. The trustee of the estate and I became friends out of the deal, and the things she said had me amazed.

1) Her agents told her she shouldn't list on the MLS, then...
2) Told her the highest offer was 50k (for a 3 bedroom, 1 bath 1/2 acre flat and usable horse property in a great part of Canyon Country) from investor "friends" of theirs, then...
3) After she insisted it get listed on the MLS and was, and I put in a full-price (210k) offer with 20% down, they tried to get her to instead accept a 120k offer from more "friends" of theirs. She accepted my offer and then...
4) They have done everything they could since, to queer the deal - not telling her when papers under deadline needed to be signed, not answering or returning phone calls from my agent, not returning her calls, giving her no info at all on what was happening. Everything she learned, she got from me. They didn't even let her know when the property passed the appraisal over asking price.

Honestly, I have little respect for the average agent. What I have seen the past 25 years revolts me, and I have only mentioned what happened on my own deal in the past month. I respect MY agent who has been scrupulous and honest, but he was a friend of mine years before he became my agent, so we have a different relationship than most.

Well, back in January, we loved a house and responded with an offer $100 over asking. Of course, we found issues during the inspection that had us backing out. We have no regrets are quite lucky. The latest house "has someone else interested". I said, let me know if that doesn't work out, see ya.

repo4sale says

I want to see the CASHIERS CHECK BIGGER THAN THE ASKING PRICE ATTACHED TO THE OFFER!

These guys look like they should be selling used cars at the We Finance Used Car Lot.

Perfect accessory for today's Real Estate "professional".

is there a yelp for realtor rating.

azrob00 you are using a classic straw man. If you advertise an asset well below market then yes you are likely to see more interest. What does this have to do with the question asked? If you re-frame the question to suit yourself and you can always claim you are right.
It is interesting that you have never seen or heard of multiple offer fraud if you are a RE "professional". I bid $20k under for a property that had "multiple offers" and mysteriously I won. There are several hundred articles in mainstream newspapers that have discussed the issue over the years. So is everyone else stupid as you claim or is a look in the mirror in order?

what m1ckey6 said.

m1ckey6 says

azrob00 you are using a classic straw man. If you advertise an asset well below market then yes you are likely to see more interest. What does this have to do with the question asked? If you re-frame the question to suit yourself and you can always claim you are right

What question are you referring to? The original poster?

I think there are some pretty shady agents out there, and then as azrob00 said, there are agents that list for well below market to generate interest. It's an asking price. It's not a selling price. They are taking offers on the house. You make an offer and then they decide which one is going to work for them. If they need to sell quickly and you've got a dozen contingencies that will take time to meet but are offering more money, you're probably not going to win.

A buyer is looking for the best offer that meets their needs as well. Buying a house includes a bunch of different aspects.

It seems that everyone is looking for the cheapest house on the market, and then trying to offer even less. Then bitching when they don't get it, because they hear others are offering less and getting those houses. Those others are most likely offering on houses listed at close to market, not at some massive discount.

It's just part of the buying process, you should evaluate what the house is worth and put a bid on it based on that. That is a fair offer. If they counter with "lots of bids on this house already!", it shouldn't effect you. Your bid is based on the value. If you're trying to buy a house from someone who WANTS it, you're going to over pay, always. People who want something, will pay more than market value for it.

Of course, if I was a seller, I sure would want others to know what the bids were. Nothing creates emotional attachment, like when you think you're going to lose a house, and others are getting into a bidding war over it and you can see what they are valuing the house at. Hiding bids puts the onus on the buyer to evaluate what THEY think it's worth and what others might consider it's worth. When you see what others are offering, you'll re-evaluate and likely offer even more, and a real bidding war will start.

Of course that would just open up a whole new shady business of hammering someones house value down into the ground. Having 8-10 low balling a house, and making it so that anyone with a realistic offer is going to redo their offer to beat the highest low baller.

If you've got legitimate buyers, letting them know what the other is offering is going to really going to help your bottom line. Of course the downside is horrendous. Organized low balling would just decimate the market. I'm betting the downside is far greater than the upside everyone would be hoping for here.

We made an offer on a fixer. It was an REO. Our offer was based purely on what our realtor believed it was worth. We agreed with her market analysis. We then factored in repairs. The banks realtor got back to us (two weeks later) and said there were multiple offers, and we were to submit our "highest and best offer." We liked the house, so we offered a few thousand more. Two more weeks go bye. They countered us with an over the listing price offer. That's when we got angry. We rejected their counter. We moved on and kept looking at other houses. One week later, our realtor calls us and asks if we're still interested in the original house. We said yes. However, we told her to make an offer LOWER than our first original offer. She was silent at first and then burst out in laughter. She said no one had ever done that before! She submitted the offer and it was accepted by the bank. The house is now ours and we couldn't be happier!

Azrobb 00 wrote: "As for rentals, same thing. The last time I advertised my one remaining rental on craigslist, I had three parties show up to rent it at the same time, and they bid it up by $50 a month, even in this poor rental market."

I am a landlord and I just rented one of my houses out on the 1st. The management company had several tenants show up and on a particular day I just happened to be there going through applications that they approved (FICO, jobs, no evictions, etc.) As I was going through these applications, there were 3 couples that came into the office at the same time. I would never even think of bidding up the price like you did. I believe that is unjust, unfair and unethical. You are a vulture and I wouldn't be able to sleep at night if I did something like that. I have immaculate homes and I get great tenants. The management company and I treat my tenants with respect, not people to be preyed upon with bidding wars for a property that is worth X amount per month. I have never had an eviction and only 2 late payers in 17 years of being a landlord. My advice to anyone renting would be to run as fast as you can if the landlord is putting the squeeze on you to bid up the price of a rental property.

tatapu70,

azrob00 was setting up a strawman argument by citing a case where he would get bona fide multiple offers by listing the house at a low teaser price exactly for the purpose of instigating a bidding war.

Does this contrived counterexample prove anything about the prevalence of multiple offers for listings that are just "competitive" with other listings, rather than teaser listing? No, it does not, and that's why m1ckey correctly called it a strawman argument.

justme says

azrob00 was setting up a strawman argument by citing a case where he would get bona fide multiple offers by listing the house at a low teaser price exactly for the purpose of instigating a bidding war.
Does this contrived counterexample prove anything about the prevalence of multiple offers for listings that are just “competitive” with other listings, rather than teaser listing? No, it does not, and that’s why m1ckey correctly called it a strawman argument.

I agree that there are unscrupulous real estate agents. No doubt about it. But, I disagree about the strawman.

Think of it this way. Would you be more likely to bid on a property that is priced below market value or above market value? Below market value, of course. And so would everyone else. So, it makes sense that those properties get the most action and visibility. I don't find the counterexample contrived at all. Do we know that there is a prevalence of multiple offers for listings that are just "competitive" with other listings? Or are they mostly on below market value properties? Note-I'm not saying everyone listed below market value on purpose. Maybe they underestimated the value, maybe they had a poor realtor, who knows?

In any event, who cares. Like many others have said--it's easy to win that game. Don't raise your offer.

I posted a modest proposal similar to Vain's, on a different forum.

AB 1721 (Koretz-D) Prices: overcharges
Prohibits any person, at the time of sale of a commodity, from charging, as defined, an amount greater than the price, or computing an amount greater than a true extension of the price per unit, that is then advertised, posted, marked, displayed, or quoted for that commodity.

http://www.sen.ca.gov/sfa/2003/_03_DL03.HTM

Why shouldn't this law be applied to houses, and compel the seller to sell at their listed price, exactly?

After all, if you go to a grocery store, and a carton of milk is priced $1.99, the checkout clerk will take your $1.99 for it - instead of saying that there are multiple offers for this carton, and to put down your highest and best.

If real estate cannot be sold at higher than posted price, it would force all listings to have realistic pricing and prevent bidding wars.

tatupu70 says

Would you be more likely to bid on a property that is priced below market value or above market value? Below market value, of course. And so would everyone else.

I disagree - I bid what I value the house at. Listing price don't mean diddly to me. Now, the other side of the coin is, REwhores refuse to submit an offer (on REO's especially) that THEY fell is below what THEY feel is "market value". SO it is REwhores that have an issue. "Market Value" will only be known when the buying programs are removed.

alex says

If real estate cannot be sold at higher than posted price, it would force all listings to have realistic pricing and prevent bidding wars.

So, you need a law to prevent you from bidding too much?

Bap33 says

“Market Value” will only be known when the buying programs are removed.

I disagree. There is a different market value with the incentives, but there IS a market value...

alex: housing isn't a commodity. You might want to dig out an economics textbook, housing is an asset class.

I don't like the low teaser listing prices, and I especially don't like really low prices that aren't market as auction or bid on the mls, because they give unrealistic ideas as to market price. Mark as auction or bid, and then who cares, you've disclosed your intentions. Then again, you have unrealistically priced short sales, which the bank will later come back with a higher price on. So it is what it is, hardly worth crying like a small child about.

All of this "they should have to sell at list price, it's so unfair that somebody outbid me"waah waah waah, won't some cries to go with your whaaaamburger? Or you could just try growing up, offering what you are willing to pay, and walking away if that doesn't win; If they don't truly have other offers, they will take yours as it is.

Regardless of how the laws are written, housing prices will be able to fluctuate and people will find ways of offering more than the asking price by having little add on items to their offers. They will get creative.

People will always try and get a little more for their house, it's special in some way to them. Or they think they can get extra because someone else thinks it's special. Whatever, the reasons, they will try and get the most for their house possible.

That being said, as a buyer, it's simple. Do your own research. It's your largest purchase you will ever make, *DO* research. Find out what it's value is. Offer that value, or less if you think you can get it.