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In Denver, it shifted overnight (February 17, 2012) from a buyers' market (we will look at 100 houses and make low-ball offers) to a sellers' market (look at the house at 0800 the day it comes on the market and make an offer or not by 0900).
Not one person saw the change coming. Not one "expert" predicted it.
New houses in my neighborhood of Berkeley, Denver, CO go under contract the day the foundation wook starts.
Same thing here (Chicago area), but it happened much later in the year. Any place that is nice and priced properly sells quickly and often with multiple offers. The last 3 deals I've been on all had at least 2 buyers, and two of them actually had 3 buyers. It was nice as a seller. As a buyer, the lack of inventory is really disappointing.
This sort of thing happens all the time. Even if they don't tell you that your offer is "insulting" people will pass and regret it.
A few years ago when they had the first time housing credit, I was looking to buy another investment property. I made an offer on a nice house in Plano, Texas. They were asking $340,000 and it was sitting on the market a while. I told them once the home housing credit ended, prices would fall. I offered $300k cash with a quick closing, no contingencies (assuming no major problems uncovered in an inspection).
The seller's realtor turned it down saying it was too low. I forgot about it as that was the price I deemed fair. Several months went by and the home housing credit ended and indeed prices did go down. I got an email a few months later asking if I was still interested. I wasn't as I already purchased another investment property.
Long story short. The house ended up selling around $278,000. LOL.
In Denver, it shifted overnight (February 17, 2012) from a buyers' market (we will look at 100 houses and make low-ball offers) to a sellers' market (look at the house at 0800 the day it comes on the market and make an offer or not by 0900).
Not one person saw the change coming. Not one "expert" predicted it.
New houses in my neighborhood of Berkeley, Denver, CO go under contract the day the foundation wook starts.
Dave
If they did not see it coming then they were not the experts/professionals...they were the amatuers and/or the behind the 8 ballers with no choices.
As others have said, some sellers just have an overly stubborn mindset when it comes to their house. Even with comps in the area, a lot of people think they have more than they actually have. DH and I noticed this when we were house hunting last year.
The first property we fell in love with, we wanted it so badly that we put in an offer just $3000 below asking with seller paying closing costs. The house had only been on the market a few days- and the seller rejected. We came back with an offer of full asking price with seller paying closing costs, and again the seller refused (they evidently wanted asking or above + buyer paying closing, and because it was new to the market they probably were testing the waters a bit). It put a bad taste in our mouth and we moved on.
One month later, they came back to us and asked us if we would like to make another offer (evidently they hadn't received anything better!). We said no, and ended up buying another property which we are totally happy with. It's not as unique as the first property (the first property was an architecturally designed 1950s home that looked more like something you'd find in Palm Springs than St. Louis, but needed a lot of work) but what we bought is in a better location and is on a better lot, and needed less work.
Back in December, I noticed that the original house we put an offer in on, FINALLY sold... for $24,000 below the original asking price. Serves them right, they could have had a full-price offer if they hadn't thought they were oh-so-special to begin with!
Anyway, my point is... sometimes sellers just really don't want to sell- or it takes them a while to realize that their house isn't the highly coveted palace they believe it is. The seller the OP dealt with will eventually have a wake up call no doubt!
They already did, they called us after about 10 days and we didn't make another offer. They lowered their asking price by 10k and told us to make a new offer. We didn't.
How much are closing costs in your area? If significant that might be why your sellers didn't want to sell when you made the offer. Here on a 250k house closing costs are about $1500. That's insignificant so I never asked for it in any offers, because sellers are already under assault, so I try to keep it clean and no contingencies.
They already did, they called us after about 10 days and we didn't make another offer. They lowered their asking price by 10k and told us to make a new offer. We didn't.
How much are closing costs in your area? If significant that might be why your sellers didn't want to sell when you made the offer. Here on a 250k house closing costs are about $1500. That's insignificant so I never asked for it in any offers, because sellers are already under assault, so I try to keep it clean and no contingencies.
In my area, it's increasingly common for buyers to ask for "buyer's assist", which commonly pays for closing costs, but could also pay for part of the down payment. Lenders have different rules regarding this. So a sold price of $200,000 may not accurately reflect what the seller actually got. They may have gotten the full amount, or they may have given back $7,0000 to the buyers. My listing agent, when figuring out comps in the neighborhood to set a listing price, showed me a number of listings that had this broken out, and helped me to understand what houses REALLY sold for.
If you're going to be insulted with the first offer, you'll never get a dialogue going with the buyers. Unless an initial offer is so far away from reality, I always make a modest counter to see if the buyers are really serious. The serious ones will continue to talk. The tire-kickers will disappear.
And as a buyer, I always try to look at comps before making an offer. We recently looked at an exceptionally nice townhome with an asking price of $849,000. A few doors away, another unit sold last summer in the mid-$500s. If you looked at interior photos, you could see some difference in the amenities, but nowhere near $300K worth. If I were to make an offer, I'd first go to the selling agent and ask her what justified the difference between the two. After hearing her answer, I'd tell her I'd have to think about it. Then, she would hopefully go back to the seller and let them know that a potential buyer was looking at the comps. That might soften up the seller to realize that an offer in, say, the low $700s might actually be somewhere in the ballpark and not necessarily "insulting." And in my area, you can also look up the price that the owner paid for the home. That will also give you a clue as to the flexibility and attitude of the sellers.
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Not true
