The Real Estate market in many areas is some people might call perfect for the picking since prices are lower than they have been in many years and there are so many bank owned and short sale homes making up the bulk of the homes for sale. With these prices at their lowest many buyers are coming out of the woodwork to buy their first home, an investment home, a second home or for various other reasons.
Making an offer that gets accepted can be a little trickier than you might think. So many people think that banks are so desperate to rid themselves of the home that they will take any offer. Think again, they are already at rock bottom prices and banks are not just willing to take any offer. In my experience as a very full time real estate agent in the Phoenix market many factors are present in what it will take to acquire the home you want. If the home is in good repair and is bank owned it will likely go fast. First, cash is king! Many buyers from Canada or other Northern States are buying homes as a second home and offering cash.
A cash buyer has a much better advantage than one using a loan, the bank knows that many people needing a loan can easily end up not qualifying near the end of the process and then they have the home back on their hands so if you are a buyer needing a loan be prepared to lose out on great low priced homes to even lower offers that are cash offers.
If you are a cash buyer and their are multiple offers on the home you will likely get a chance to give your highest and best offer as a final offer before the bank makes the final decision. Going over the asking price with many offers on the table is naturally a good idea, also using an odd number plus is a great strategy. For instance, say the home is listed for $150,000, they have several offers at this time, likely most are full price and they are asking all offers to give their highest and best. You may want to consider maybe $157,123. Why such a strange number? Other will have the same idea of going over to at least $155,000 then maybe add a little for good measure say $157,000, now yours is in at only $123 more but it is still higher and it will likely be the amount that actually helped you secure the property.
If you are a buyer with a loan this strategy can still be helpful but if a cash offer of just slightly less comes in keep in mind the bank may still take the other offer since there will be no appraisal needed and no loan to worry about.
If you don’t get the first one, keep looking, keep trying – there are still enough homes out there for everyone wanting one. Short sales are a lot different so that strategy is a whole new subject and the wait time is very long so most cash buyers are not willing to wait. If you are not in a hurry you may want to consider going down that route.