A Level Playing Field

This really is a strange market. Some houses come up and just sit. There’s listings out there that have been around, seemingly, forever. There’s plenty of these in Foster City. Others, particularly those that are gorgeous and are priced right, get swept up in multiple offer frenzy. With some listings it’s still 2005. I’ve seen old school multiple offer insanity several times this year on listings in Millbrea, Burlingame, Palo Alto, San Carlos, Redwood City, Belmont, San Mateo and, yes, Foster City. I’ve also seen houses stay in the market for 200 days or more…go figure! In one case in Burlingame recently, a probate on Rivera was listed for $1,025,000. Honestly, the house needs plenty of work but it’s a good location and the house got 19 offers. Since it’s a probate it needs to go through the court confirmation process and thus an overbid amount is published. That means that the court provides folks with an amount you would need to offer to outbid the existing high bid. It’s a published figure. That amount? $1,365,500. In another case, a house on Colorados in Millbrae, listed for $1,075,000 sold for $1,280,000.

In both of the above mentioned cases, the houses had fixed dates and times for reviewing offers. Particularly in the probate case, there couldn’t be much more of a level playing field. The offers were due at one time and the court allows other interested parties to try again if they can by stating the price to everyone. As for the Millbrae listing, I have no doubt that the folks who got that house paid WAY over their competition for that house…they must have really wanted it badly. I guess my point here is that at the very least all potential buyers on both of these listings had the opportunity to take their best shot. In alot of other instances lately, it hasn’t been that way…and it should.

In one instance, the listing agent established a set date to review offers. Offers were presented and the listing agent stalled for an additional 48 hours, collected a few more offers and then ratified. Each time leveraging the earlier offers to increase the total the seller could get. Seems sort of unfair if you were the ones making the earlier offer, doesn’t it? I mean, you make an offer at the deadline based upon the knowledge that there’s 3 offers and then 2 other parties come in 2 days later, they have a distinct advantage. Or how about this, you present an offer on a listing with no competition and after a couple of days the listing agent tells you that the seller can’t make a decision for another week because she’s just too busy. Meanwhile, the house will be held open this coming weekend. If your a buyer you’re certainly going to feel like the seller and agent are going to “shop” your offer to any other potential buyer who may call in this time period, won’t you? It’s actually unethical to do this since the purchase contract clearly states that “time is of the essence in this contract”. Oh well?

Not much you can do in these circumstances. It would sure be nice if there was a uniform way to insure a level playing field though.

Comments

  1. Yes, I think it is unfair and unethical tactic for the listing agent to tell potential buyers that several other offers were in, and the buyers can never verify it, and the buyers who wanted the house were forced to raise price beyond market value, I think we were in that kind of situation earlier this year, overbid our houses almost 80k above listing price, and we could never get a chance to see other offers the listing agent said she/he got. I think after the contract is signed, the buyer should have the right to see other bids, artificially inflate the house price is not only unethical, it also creates lots of financial problems down the road, not only to the family, but to the society as well.

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