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I think the original OP question here was, "Do realtors sometimes say and do things to motivate a seller to write an offer now, -- such as infer or even say that another offer might be coming in?" The answer is, of course they do -- all the time. A potential offer is always possible when 'potential buyers' express an interest in any listed property.
In such a case, an appropriate response might be, "Great, let me know when it materializes so I can submit a competitive offer then!" -- Then the realtor will truly be able to tell the other 'buyer' that they "might have another offer coming in." When you expressed your interest, I'll bet the realtor went back to another 'interested looker' and said, "Someone may be ready to submit an offer, so you probably better move quickly, if you are still interested."
One approach you might consider is to have a confederate submit an offer immediately after yours at a price that is below your offer. This reverses the situation and gives you leverage and control over the transaction by putting pressure on the seller to accept your offer.
Its a fine line - if the other offer intends to complete the contract, I don't think it could be characterized as fraud.
Ready, willing, able - its legal. Its a gray area in terms of ethics, but I don't think it would be unethical, especially not from the other buyer or the agent who is just writing an offer, and I am pretty certain its not illegal.
I don't think it would be that effective though unless the seller had already rejected an offer or two in that lower range. Most sellers are dead set on what they want to receive.
That unscrupulous buyer is making an unknowing accomplice of his/her agent---
The offer is only made to benefit someone else--not the person making the offer...
I've been the other offer coming in several times...
The last time the seller had just accepted an offer and mine came in the same day... mine was non-contingent except for appraisal and was all cash to seller, as-is AND 100K over the accepted offer.
I insisted my offer be fully documented and placed in back up... my mistake because it eventually fueled the sale...
Reason is once the buyer knew it was legit he buckled down... that list of inspection deficiencies disappreared... because of me waiting in the wings.
Funny thing is Listing Agent did not want to acknowlege me and was actually a little hositle at first... she did not have the buyer.
Later she admitted she thought my offer was too good to be true... but it was 100% genuine and would have netted everyone a lot more money and instead for a 60 day escrow it would have been 21 days.
The only way I was able to be taken seriously was to approach the seller directly... I had known her husband as we both restored antique cars and just happened to see the for sale sign.
I also tracked down the buyer and offered him 100K to walk away... but he laughed... saying it would take 300k for him to walk... yes the deal was that good.
It has been 5 years now and the property has easily doubled in value and no way I could buy it at today's price... plus pay double the Prop 13 property tax...
OK. A confederate is someone who is in cahoots with someone else.
con·fed·er·ate (kən-fĕd′ər-ĭt)
n.
1. A member of a confederacy; an ally.
2. One who assists in a plot; an accomplice. See Synonyms at partner.
3. Confederate A supporter of the Confederate States of America.
adj.
1. United in a confederacy; allied.
OK. A confederate is someone who is in cahoots with someone else.
con·fed·er·ate (kən-fĕd′ər-ĭt)
n.
1. A member of a confederacy; an ally.
2. One who assists in a plot; an accomplice. See Synonyms at partner.
3. Confederate A supporter of the Confederate States of America.
adj.
1. United in a confederacy; allied.
It is a term of art with a special meaning in the real estate investment community.
Right. We understand what it is... fraud. And would be a violation of the Code of Ethics if the Realtors did know about it, so it is both smart and kind to keep the agents in the dark. Doesn't make it *right*.
I don't think it's fraud at all ... IF the "confederate buyer" is able and willing to buy the property at their lower price. And why wouldn't they be?
Seller wants $300K
Westcoaster offers $270K. Seller balks.
Confederate offers $260K, making Westcoaster the better offer. Even if somehow the Seller chooses Confederate (maybe theirs is cash or better terms than WC's) then Confederate and Westcoaster just "made" an extra $10K.
NOW ... all of this depends on what REPRESENTATIONS each Buyer makes within the legal document of their location.
I don't think it's fraud at all ... IF the "confederate buyer" is able and willing to buy the property at their lower price. And why wouldn't they be?
Seller wants $300K
Westcoaster offers $270K. Seller balks.
Confederate offers $260K, making Westcoaster the better offer. Even if somehow the Seller chooses Confederate (maybe theirs is cash or better terms than WC's) then Confederate and Westcoaster just "made" an extra $10K.
NOW ... all of this depends on what REPRESENTATIONS each Buyer makes within the legal document of their location.
Maybe I'm wrong.
I guess that might work on some sellers. I think most people, though, would choose to balk at both offers.
oh absolutely most would. I was just waiting for the explanation I expected and got.
At the same time, it might also be a very valid idea. What if Seller's agent tells them the house is worth $280K. Westcoast makes an offer for the market value, $280K. Seller responds to his agent "I still believe it's worth $300K. I'm going to wait"
then Confederate produces his $270K offer, and Seller's agent presents it. It is reality, and it is the professional thing to do to advise the Seller in nice terms "Look, I told you it was worth $280K. You've got 2 offers, one is for the market value and one's a little below. The market is telling you it's $280K. Do you want to accept the market value offer before they go away, or do you want to hold out" And perhaps the Seller "comes to their senses" and accepts the $280K.
Understand, this involves the assumption that none of the agents understand what the others are doing, and the Seller's agent had good reason (like comps) to have told them the house was worth $280K.
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