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Wait, what?
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Who cares if the house is sold in such a way, or appeals to the seller getting the highest value for their property? Having sold a house or two over the years, I can say that I’d rather have more than less. And I can say from said experience that not all realtors want to act in the sellers best interest. Both houses I sold were “listed too high” in the realtors opinions. It isn’t that they were willing to give up a higher commission. Realtors deal in time as well as property. If they have to show the house to 100 people before a sale as opposed to showing to 10 before the same in a shorter period of time, they will choose the latter believing that money today is better than only the possibility of more tomorrow. If “coming soon” nets the seller more profit, good.




"Live every day as if it's going to be your last, and one day, you'll be right.”
Malachy McCourt
 
Posts: 12001 | Location: Martinsburg WV | Registered: April 02, 2011Reply With QuoteReport This Post
paradox in a box
Picture of frayedends
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Your are correct Gearhounds. My gf will always recommend listing at a fair price. Overpriced properties sit for a long time. When the seller finally agrees to a price reduction buyers think something is wrong with the place. Better to price right and have bidding war.




These go to eleven.
 
Posts: 10416 | Location: Westminster, MA | Registered: November 14, 2006Reply With QuoteReport This Post
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I have not seen the coming soon but I have seen properties listed in the MLS but stated no showings unit XXX date. Its just a way to drive up interest in hopes the property sells on day one. People get emotionally attached and will be forced to make an offer or lose the property.


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Posts: 4383 | Location: Pittsburgh, PA, USA | Registered: February 27, 2001Reply With QuoteReport This Post
safe & sound
Picture of a1abdj
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quote:
If you ever sell any real estate, feel free to refuse all offers above asking price.


My family is in the building business, and we have sold thousands of homes in the St. Louis area for a price. I can't recall a single instance in which a buyer offered us more than what we told them the price would be.

Come to think of it, I can't recall a single instance, ever in my life, where I paid more than the asking price for an item. Do you? Do you go into the gun store and slap down $500 for a gun with a $400 price tag?


quote:
That simply isn't how real estate works. Anyone that goes in expecting to have a full price offer accepted just doesn't know what they are doing (in a seller's market). There is a lot more than price. When realtors say "highest and best", best means a lot. A full price cash offer is the best unless there is a higher price cash offer. Closing date can be a deal breaker. VA of FHA financing is often a deal breaker. Down payment amount, home inspection requirement, etc. There are tons of things that go into a real estate deal that mean more than the price alone.


In addition to the family business mentioned above, I was also a licensed Realtor.

I know that's "not how it works" which is why I have a problem with it. If the intent is to sell to the highest bidder, then the asking price format is the incorrect choice. Auctions have bidders. Listings for sale have buyers.

Don't list something for sale, for a price (and we can include conditions in there as well), and not be willing to accept a seller offering exactly what you're asking for. If you're wanting to create a bidding war, then hire a real estate auctioneer.


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Posts: 14299 | Location: St. Charles, MO, USA | Registered: September 22, 2003Reply With QuoteReport This Post
paradox in a box
Picture of frayedends
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quote:
Originally posted by a1abdj:
quote:
If you ever sell any real estate, feel free to refuse all offers above asking price.


My family is in the building business, and we have sold thousands of homes in the St. Louis area for a price. I can't recall a single instance in which a buyer offered us more than what we told them the price would be.

Come to think of it, I can't recall a single instance, ever in my life, where I paid more than the asking price for an item. Do you? Do you go into the gun store and slap down $500 for a gun with a $400 price tag?


quote:
That simply isn't how real estate works. Anyone that goes in expecting to have a full price offer accepted just doesn't know what they are doing (in a seller's market). There is a lot more than price. When realtors say "highest and best", best means a lot. A full price cash offer is the best unless there is a higher price cash offer. Closing date can be a deal breaker. VA of FHA financing is often a deal breaker. Down payment amount, home inspection requirement, etc. There are tons of things that go into a real estate deal that mean more than the price alone.


In addition to the family business mentioned above, I was also a licensed Realtor.

I know that's "not how it works" which is why I have a problem with it. If the intent is to sell to the highest bidder, then the asking price format is the incorrect choice. Auctions have bidders. Listings for sale have buyers.

Don't list something for sale, for a price (and we can include conditions in there as well), and not be willing to accept a seller offering exactly what you're asking for. If you're wanting to create a bidding war, then hire a real estate auctioneer.


For new construction you are right. Generally the price is set. But as you also know the builder makes more money on upgrades. The initial agreed price is rarely the final price.

Regarding existing sales I don’t get your problem with it. There is a list price not an “asking” price. If there is low inventory and multiple offers you think the seller should take the list price offer, ignore higher offers, and ignore all the other factors that make an offer good or not? If it were a buyers market things would be different. But home sales are always best offer situations. I think people most understand this. If they don’t then they should hire a good realtor. Wink




These go to eleven.
 
Posts: 10416 | Location: Westminster, MA | Registered: November 14, 2006Reply With QuoteReport This Post
Semper Fi - 1775
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Update on this practice

Realtors group looks to tighten restrictions on pocket listings

Pocket listings, also known as coming-soon and off-market listings, have become increasingly common in the Twin Cities and inner-ring suburbs where demand for entry-level houses exceeds supply. For agents who specialize in the most popular neighborhoods, the practice has become a way of attracting buyers who want a first look at a property before it hits the market, decreasing the chance of competing with other buyers.


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Posts: 10554 | Location: Belly of the Beast | Registered: January 02, 2009Reply With QuoteReport This Post
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quote:
Originally posted by a1abdj:
quote:
If you ever sell any real estate, feel free to refuse all offers above asking price.


My family is in the building business, and we have sold thousands of homes in the St. Louis area for a price. I can't recall a single instance in which a buyer offered us more than what we told them the price would be.

Come to think of it, I can't recall a single instance, ever in my life, where I paid more than the asking price for an item. Do you? Do you go into the gun store and slap down $500 for a gun with a $400 price tag?


quote:
That simply isn't how real estate works. Anyone that goes in expecting to have a full price offer accepted just doesn't know what they are doing (in a seller's market). There is a lot more than price. When realtors say "highest and best", best means a lot. A full price cash offer is the best unless there is a higher price cash offer. Closing date can be a deal breaker. VA of FHA financing is often a deal breaker. Down payment amount, home inspection requirement, etc. There are tons of things that go into a real estate deal that mean more than the price alone.


In addition to the family business mentioned above, I was also a licensed Realtor.

I know that's "not how it works" which is why I have a problem with it. If the intent is to sell to the highest bidder, then the asking price format is the incorrect choice. Auctions have bidders. Listings for sale have buyers.

Don't list something for sale, for a price (and we can include conditions in there as well), and not be willing to accept a seller offering exactly what you're asking for. If you're wanting to create a bidding war, then hire a real estate auctioneer.
My house sold for $5000 over asking in St.Louis 4 years ago. There was two couples who really wanted it. My Realtor told both couples to put in their best and final offer and one was over asking. I'm sure it's not super common but apparently it does happen. I'm surprised in all the dealings you have had it has never happened when it happened to me on my one and only house in St.Louis.
 
Posts: 1886 | Registered: January 25, 2013Reply With QuoteReport This Post
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quote:
Originally posted by 1s1k:
quote:
Originally posted by a1abdj:
quote:
If you ever sell any real estate, feel free to refuse all offers above asking price.


My family is in the building business, and we have sold thousands of homes in the St. Louis area for a price. I can't recall a single instance in which a buyer offered us more than what we told them the price would be.

Come to think of it, I can't recall a single instance, ever in my life, where I paid more than the asking price for an item. Do you? Do you go into the gun store and slap down $500 for a gun with a $400 price tag?


quote:
That simply isn't how real estate works. Anyone that goes in expecting to have a full price offer accepted just doesn't know what they are doing (in a seller's market). There is a lot more than price. When realtors say "highest and best", best means a lot. A full price cash offer is the best unless there is a higher price cash offer. Closing date can be a deal breaker. VA of FHA financing is often a deal breaker. Down payment amount, home inspection requirement, etc. There are tons of things that go into a real estate deal that mean more than the price alone.


In addition to the family business mentioned above, I was also a licensed Realtor.

I know that's "not how it works" which is why I have a problem with it. If the intent is to sell to the highest bidder, then the asking price format is the incorrect choice. Auctions have bidders. Listings for sale have buyers.

Don't list something for sale, for a price (and we can include conditions in there as well), and not be willing to accept a seller offering exactly what you're asking for. If you're wanting to create a bidding war, then hire a real estate auctioneer.
My house sold for $5000 over asking in St.Louis 4 years ago. There was two couples who really wanted it. My Realtor told both couples to put in their best and final offer and one was over asking. I'm sure it's not super common but apparently it does happen. I'm surprised in all the dealings you have had it has never happened when it happened to me on my one and only house in St.Louis.


In the neighborhood I live in homes routinely are on the market for a week or less and often get sold for above asking price. Usually the house will get listed on a Wednesday or Thursday, have showings, followed by an open house on Saturday or Sunday. Usually by Monday or Tuesday they are under contract after receiving and reviewing multiple offers.
 
Posts: 594 | Location: PA | Registered: June 21, 2001Reply With QuoteReport This Post
safe & sound
Picture of a1abdj
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quote:
I'm surprised in all the dealings you have had it has never happened when it happened to me on my one and only house in St.Louis.



It happens all the time, which is my problem.


quote:
In the neighborhood I live in homes routinely are on the market for a week or less and often get sold for above asking price.



Gee....seems almost as if a lot of these professional realtors are missing the mark on value, causing an influx of interest due to the "deal", which in turn causes a bidding war "auction" that results in a higher sale price.

Realtors should be required to be licensed auctioneers. Wink


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Posts: 14299 | Location: St. Charles, MO, USA | Registered: September 22, 2003Reply With QuoteReport This Post
paradox in a box
Picture of frayedends
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quote:
Originally posted by a1abdj:
quote:
I'm surprised in all the dealings you have had it has never happened when it happened to me on my one and only house in St.Louis.



It happens all the time, which is my problem.


quote:
In the neighborhood I live in homes routinely are on the market for a week or less and often get sold for above asking price.



Gee....seems almost as if a lot of these professional realtors are missing the mark on value, causing an influx of interest due to the "deal", which in turn causes a bidding war "auction" that results in a higher sale price.

Realtors should be required to be licensed auctioneers. Wink



You are wrong on your criticism of realtors. Almost every house my GF sells goes for over asking these days. But they usually appraise right on what the list price was. So she is obviously doing the job correctly. Appraisal is a big factor on if an "over asking" offer can be accepted. The buyer must be able to cover the difference if it doesn't appraise.

The market determines price and things change quickly. For example she recently had a condo with multiple offers over asking. They took an offer but then the buyer financing fell through. The other buyers had already found condos to buy. So it went back on market and has actually had a price reduction. That is all in less than a month. From multiple over asking offers to a price reduction. Real estate changes fast.




These go to eleven.
 
Posts: 10416 | Location: Westminster, MA | Registered: November 14, 2006Reply With QuoteReport This Post
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quote:
Originally posted by frayedends:
quote:
Originally posted by a1abdj:
quote:
I'm surprised in all the dealings you have had it has never happened when it happened to me on my one and only house in St.Louis.



It happens all the time, which is my problem.


quote:
In the neighborhood I live in homes routinely are on the market for a week or less and often get sold for above asking price.



Gee....seems almost as if a lot of these professional realtors are missing the mark on value, causing an influx of interest due to the "deal", which in turn causes a bidding war "auction" that results in a higher sale price.

Realtors should be required to be licensed auctioneers. Wink


Seriously either some of you guys just live in states that are very different than the Massachusetts market or you really have no idea what you are talking about. I don't mean to insult but you are way off the mark.

My GF does a market analysis and gives the most accurate value based on comps, and all the other stuff. But when you have a hot market and low inventory buyers are always looking for an edge. It's simple, they take offers and present them to the sellers. The realtor isn't auctioning the property. The realtor has no say in what offer is accepted. They present all offers to the seller.

If the offer is asking and good and there are no other offers then it will likely be taken. But if there are multiple offers with some better (better may be price or financing, closing date, all sorts of factors) then obviously the seller is going to take the best offer.

I really think it's absurd any of you think that the seller must take the first full price offer and ignore all the other factors.

ETA: Most over asking offers are about 1-5K. They also come when realtors ask if any other offers have been received and if the answer is yes they will present their higher offer. Often times, after an open house there will be multiple competing offers. The realtor will give everyone a fair chance and say for buyers to present highest and best offers by a certain time so the seller may choose. I guess that sort of is like an auction. But it's not the realtor setting the sale price.

Something else to consider on higher offers. Depending on financing the house needs to appraise at the right price. If a person offers higher than asking and the house appraisal isn't high enough the buyer has to have enough cash to cover that or they will lose financing. So this often comes into play when deciding on what offer is good. The amount of cash down can be more important than the offer price.


frayedends...well said. Houses where I am are listed based off of the latest comps for my neighborhood. There are about 120 homes and on average about 6 to 10 are listed annually. There are several things that keep the neighborhood in high demand, and low inventory and high demand drive the quick sales, however, the list price cant be so far out of line that the appraisal is too low.
 
Posts: 594 | Location: PA | Registered: June 21, 2001Reply With QuoteReport This Post
paradox in a box
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quote:
Originally posted by Bulldog:


frayedends...well said. Houses where I am are listed based off of the latest comps for my neighborhood. There are about 120 homes and on average about 6 to 10 are listed annually. There are several things that keep the neighborhood in high demand, and low inventory and high demand drive the quick sales, however, the list price cant be so far out of line that the appraisal is too low.


Oh, you quoted me while I was editing my post to shorten it. I read a1abdj's post and I get that he would prefer a set price. But that simply could never work in real estate. There are just too many factors. In a buyer's market the seller would want to hear offers even lower offers. Imagine they just didn't get any offers because they didn't price exactly as a buyer wanted? It's a silly idea.




These go to eleven.
 
Posts: 10416 | Location: Westminster, MA | Registered: November 14, 2006Reply With QuoteReport This Post
safe & sound
Picture of a1abdj
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quote:
You are wrong on your criticism of realtors.



I'm not criticizing all realtors, just those who auction properties.


quote:
Almost every house my GF sells goes for over asking these days. But they usually appraise right on what the list price was.



Does. not. compute. If every $100,000 house sells for $125,000, then every $100,000 house would appraise for $125,000 seeing that's what they're all selling for.


quote:
I really think it's absurd any of you think that the seller must take the first full price offer and ignore all the other factors.


I think it's absurd when the seller is not prepared to take the first full price offer when there are NO other factors.

Cash buyer, no contingencies, immediate closing. If you have it listed for a price and this buyer offers you that price, you should sell it for that price.

I have seen this behavior with bank owned homes more than others, but that's probably because I'm rarely looking at the others.


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Posts: 14299 | Location: St. Charles, MO, USA | Registered: September 22, 2003Reply With QuoteReport This Post
paradox in a box
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quote:
Originally posted by a1abdj:
quote:
You are wrong on your criticism of realtors.



I'm not criticizing all realtors, just those who auction properties.


quote:
Almost every house my GF sells goes for over asking these days. But they usually appraise right on what the list price was.



Does. not. compute. If every $100,000 house sells for $125,000, then every $100,000 house would appraise for $125,000 seeing that's what they're all selling for.


quote:
I really think it's absurd any of you think that the seller must take the first full price offer and ignore all the other factors.


I think it's absurd when the seller is not prepared to take the first full price offer when there are NO other factors.

Cash buyer, no contingencies, immediate closing. If you have it listed for a price and this buyer offers you that price, you should sell it for that price.

I have seen this behavior with bank owned homes more than others, but that's probably because I'm rarely looking at the others.


If you think presenting all offers to the seller is “auctioning “ you are criticizing all realtors.

I don’t know a1. You are making strange assumptions. Offer prices rarely are the same as appraisal. Banks look at square footage, maybe upgrades and location. They look at comps too. But markets change on a dime. Minor things affect buyer offers. The over asking offers are not usually set like you say. We are never talking about a bunch of homes priced the same in the same place with the same offer. Real estate is way more complex. Explain how my girlfriend sold 80 homes last year, most above asking and most appraisals very close to list? May not compute with you but it’s reality.

As far as your other example I can’t speak to that much. Most transactions my gf does are not similar. I don’t think I’ve seen all cash no contingency offers except the occasional flip. In those cases you are right and the offer would generally be accepted. But often realtor also put an offer deadline so they have to wait for the deadline and may have multiple offers then also.




These go to eleven.
 
Posts: 10416 | Location: Westminster, MA | Registered: November 14, 2006Reply With QuoteReport This Post
safe & sound
Picture of a1abdj
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quote:
If you think presenting all offers to the seller is “auctioning “ you are criticizing all realtors.


Well auctions are generally legally defined as part of the whole licensing issue involving auctioneers. Don't confuse what I'm saying with what I'm not saying.

If a realtor lists a property, at a price designed to instigate a bidding war, with no intention of accepting the asking price, then they are indeed auctioning the property.


quote:
Explain how my girlfriend sold 80 homes last year, most above asking and most appraisals very close to list? May not compute with you but it’s reality.


That's an entirely different discussion that could be had, but it boils down to make believe. Appraisals can be whatever anybody wants an appraisal to be. Not much different than polling.

quote:
I don’t think I’ve seen all cash no contingency offers except the occasional flip. In those cases you are right and the offer would generally be accepted.


Most bank owned properties in our area are sold in this fashion. As is, cash sales, no contingencies. So if a realtor representing one of these is asking for highest and best, then you'd agree they're attempting to auction the property. No?


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Posts: 14299 | Location: St. Charles, MO, USA | Registered: September 22, 2003Reply With QuoteReport This Post
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Appraisals are done AFTER the offer has been accepted, contract executed and mortgage applied for. So the appraiser knows the sale price before he gets there to appraise the property. Not too many people bother with an appraisal if they're paying cash. I suppose, if the house had sat there for a while and a cash buyer wanted to use his own handpicked appraiser to beat the seller up a little on price, he could do that. Our current house appraised for $14k below contract price, but then that was just after the laws changed and lenders were no longer allowed to handpick appraisers. So the appraiser who was randomly selected by the bank's software happened to be from 100 miles away and was not familiar with our market. But it worked in our favor, so we took the $14k discount when the appraisal came in low and the bank (it was bank-owned) lowered the price by that much.
 
Posts: 1973 | Location: Cave Creek, AZ | Registered: October 24, 2005Reply With QuoteReport This Post
His Royal Hiney
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All I know is that in CA, prices for similar houses go up and down quite significantly in a year, much like the story told of accepting an overbid where the financing fell through only to end up selling lower.

In the hot market before 2008, sellers were even having to write a "Please pick my offer" letter to the home buyer like a kid writing an acceptance essay for college. Seriously.



"It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946.
 
Posts: 15861 | Location: Bay Area, CA | Registered: March 24, 2011Reply With QuoteReport This Post
paradox in a box
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a1 I do get what you are saying and I guess I can understand why you don’t like it. But unfortunately that’s the way real estate works. I can’t criticize realtors for doing their job. If you want to call it auctioning so be it. Realtors do market properties to promote bidding wars. They are doing right by their clients to get highest and best. In the end the buyer pays what they think it’s worth and are willing to pay. At some point the market crashes and buyers low ball and sellers may have to accept. I don’t see how a fixed price could work with all the factors involved.

Buyers do a lot of crap too. They use home inspection to lower price even though they knew issues when making an offer. They look for closing credits to lower the price but leave with cash.




These go to eleven.
 
Posts: 10416 | Location: Westminster, MA | Registered: November 14, 2006Reply With QuoteReport This Post
Savor the limelight
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I don't see how collecting offers and picking the best one is an auction. When we bought our last home, a bank owned property, we submitted our best offer. The agent wouldn't tell us what the other offers were. If I were selling and had multiple buyers interested, you can bet I'd negotiate the highest best price I could get, but if the buyers don't know what the other buyers are offering, it's not an auction.

Back on topic:

Yes, I've noticed these signs as well recently in my area.
 
Posts: 6122 | Location: SWFL | Registered: October 10, 2007Reply With QuoteReport This Post
safe & sound
Picture of a1abdj
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quote:
but if the buyers don't know what the other buyers are offering, it's not an auction.



Sure it is, by legal definition.

quote:
An auction is a form of sale. In an auction, property is publicly put up for sale. An auction has a seller and a varying number of prospective buyers. Thus, an auction can be defined as “the public sale of a property to the highest bidder.


Again, I'm not talking about "taking offers". I'm specifically talking about agents who intentionally underprice listings in order to start a bidding war which will result in a higher than list price.

I have no problem with people who want to list property for sale, for a price, and accept offers. I also have no problem with those who wish to auction their property. What I do have a problem with is pretending that you're doing one, when in fact you are doing the other.


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Posts: 14299 | Location: St. Charles, MO, USA | Registered: September 22, 2003Reply With QuoteReport This Post
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