What Happened to the Buyer's Market?
OK. Everyone who follows real estate knows that we are currently in a Buyer's market (which is defined by slow moving inventory, great negotiating leverage for home buyers, and stagnant to falling prices).
I'm here to tell you that there is currently a Seller's market (yes - you read that right) that exists right inside the Buyer's market we hear and read about.
In the last three weeks, I have had three different buyers get "beat out" by other buyers on homes - you may find this surprising (but it is true!):
First off - I represented the Buyer on this... This home was a bank owned property (Countrywide, in fact), in a nice area of homes priced in the $350K - $450K range, and had more than its fair share of deferred maintenance (aka - writing on the walls, holes in the walls, dead lawn, dirt back yard, and oh yes - that wonderful odor on the inside!). The listing price was $303K. After taking a look and thinking it over, my client wanted to put in an offer at $290K. By the time we were ready to put in the offer, Countrywide had already received two offers. Instead of countering the offers, Countrywide responded by requesting the prospective Buyers submit the "best and final offer". Well, the other offers were higher than $290K and, on this one anyways, my client did not get this prize (which would clean up quite nice...). OK - three competing offers for one home (that was priced very aggressively).
Again, I represent the Buyer (different person from above). This home came on the market at $285K and fit quite nicely into what my client has been looking for: right location - Johnson Lane area, 3 bedrooms, 2 bathrooms, 3 car garage, about 1,600 square feet, decent curb appeal. Well, the home already had an accepted offer after three days on the market. I don't know the accepted price (will post this in my blog next month when it becomes public) but WOW was that fast. Again, another one got away!!
New buyer, new market. List Price: $230K, 4 bedroom, 2 bath, 3 car garage, stucco exterior, 1,800 sq. ft. and, yes, way under priced by the bank (Citigroup). This home was purchased in mid 2006 for $330K (no surprise - 100% financing and variable rate loan program). Before I was able to show it to my client (within 3 days of being listed), the bank had two offers - one at $180K and the other at $225K. Citigroup accepted the $225K offer. Done deal.
What's Happening Here?
This is a small peek into the number of buyers (in these price ranges) who are ready and willing to MOVE FAST when there is real value on a property. At these price ranges, we are actually starting to see some investors returning to the market due to a better cash flow from rentals, etc.
If you are looking for a really good deal in these price ranges today, and you see a DEAL, MAKE AN OFFER quickly - it truly will not last. Now, at higher price points, this is clearly not happening but the real estate market recovers from the "bottom up" so these deals do indicate that this price range is probably getting close to a bottom.
Oh by the way, don't think that I loose everything for my clients. These folks will all find something that works and I expect to represent their interests in the transaction.
Let me know if you have any questions or post a comment below:
Broker - CalNeva Realty