“Please, submit your highest and best offer”. That is what the banks real estate agent said today when I asked about the status of an offer my client submitted on a foreclosure home in Buckeye, AZ. We were also informed that there were a total of twelve offers for the home.
As is the case with many of the foreclosured homes listed on the Arizona Regional MLS these days, this home had been on the market for less than a week and it had a flood of offers from prespective buyers. Banks have learned to use what I like to call the eBay method of selling; namely set the list price low and let the buyers compete with each other and bid it up. Not only do they get to sell the home for the best price but they get it sold quickly.
As a buyer’s agent, there is something that I have to admit I find very annoying about this process; namely that the seller is not disclosing what the current highest offer for the home is, even on eBay you get to see the highest bid. It could very well be that our current offer is the highest and the bank is using the fact that there are 11 other offers to provoke us and the other buyer’s into bidding higher. Additionally, not knowing what the highest offer is leaves us guessing whether it is even worth the time, effort and patience to play the bidding game. What if the current highest offer is above what is a resonable price for the home or higher then my client can get a loan for?
So what is a buyer to do? In this case, the original offer price was below the recent comparable sales in the area so there is room to come up on the price. There are also a lot of other homes available in the same price range and area of the west valley. So we are going to submit a higher offer but leave enough room to allow for a little more downside in this market just incase values continue to slide. If our second offer is the one that gets accepted then great, if not we will know that someone else paid to much for the house and we can look else where for a better deal.
I’ll let you know how it goes…
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