$200,000 Over Asking Price Wasn’t Enough-The Tale of a Sale

As 2009 comes to a close best wishes for a happy, peaceful and prosperous new year. One of my blog goals is to keep you up to date with what is really going on in the real estate market.

Earlier this month I alerted a buyer client that this home was a new listing. As you can see, this is a cute vintage home with great curb appeal. Looking at the interior photos reveals a traditional home built in the 1930’s.

The list price was in the low $700,000’s. The appealing look of the home and that price was the first indicator of what was coming. As I expected, my client wanted to see the home the next day, which was Thursday. Broker Tour was scheduled for Friday and both Saturday and Sunday open houses were on the calendar as well. Offers were scheduled for the following Wednesday.

The home was originally built as a two bedroom one bath. Over the years a third bedroom and bath had been added in the attic and a family room addition was built at the back of the home. The home’s interior condition is what could be called “vintage”. In other words it need compete updating, plus the additions created what is called “functional obsolescence”, although some might call it “funky”. To create stairway access to the attic bedroom a kitchen wall had been removed. Now there was no room for the refrigerator in the kitchen so it was located in the laundry area, which also served as the back porch and led to the upstairs staircase. The entrance to the “family room” was through this combination back porch, laundry, staircase area.

Turns out that there were nearly 500 people through the open houses over the weekend and by Tuesday there had been 80 disclosure packages downloaded and the listing agent had 15 confirmed offers.

Since my client wanted to make an offer we determined that the best shot would be their “highest and best “offer up front. This turned out to be $202,000 over the asking price, a 30 day escrow and a five day inspection contingency period. Of course, they already had their loan approval.

There were at least 20 offers and my clients offer was not the winning offer. I strongly believe (although it is not confirmed) that the home went for well over $1million.

The lessons for sellers; picture perfect presentation and pricing at the low end of the value range is what will get you top dollar in the shortest time.

For buyers; a new listing that gets your attention with price and presentation will get the attention of others. Despite what you’ve heard, there are plenty of qualified buyers and inventory is low. Be prepared to be in a competitive situation and make your “highest and best’ offer first because you probable will only get one chance. Another strategy is to look for homes that have “aged” on the market due to cosmetic appearance or high pricing. Over time sellers become more realistic about price.

Now, more than ever buyers and sellers will benefit from the advice and guidance that an experianced REALTOR® can provide. If you are in the San Francisco Bay Area, I invite you to start at our Resource Center, www.AboutBayAreaHomes.com. There you will find links for active home listings, including bank owned and short sales, home loans, market activity reports, home seller strategies, staging and decorating, a suite of 19 calculators, plus my book, “Let’s Make a Deal, The insiders Guide to Buying and Selling Real Estate” and more. Of course I am always available to discuss your real estate or mortgage related questions or concerns, just call, text or email me for a prompt response.

Russ Boyd and his team professionally assist buyers, sellers and homeowners in the Peninsula Communities of the San Francisco Bay Area. They serve clients in San Mateo, San Francisco, Santa Clara, Alameda and Contra Costa counties. Licensed as a Real Estate Broker by the California Department of Real Estate, 01264240.