Tag Archives: Multiple Offers

Real Estate Isn’t Fair: There’s No Longer Anything to Buy

If supply and demand rules everything, then please tell me what is going on with the market right now. 

The calendar year started with a ten-year low in inventory, 3285 listings for sale. Instead of seeing a build up in inventory in January, inventory actually dropped to 3157 listings by February 1st. This sometimes happens, where January is the doldrums and not much is going on in either the buying or selling side of things. Things usually start happening in February and get rolling in March.

Well things started happening in February, but it wasn’t a build up of inventory. As of this morning there are 3161 listings (patio home and single family combined) for sale. An increase of four units in a traditional inventory-build month. This has happened before, in 2002, inventory levels were almost identical and sale rate was almost identical. Average and median prices were also similar. And February ended up lower than January in terms of inventory. 

The part I find crazy is the sales rate: Last week when I ran the check on Tuesday, there were 1551 “contracted” listings (pending, under contract, under contract short-sale and first-right of refusal contingent on buyer’s listing closing). Six days later… there are 1742. If you throw out the short-sales and contingencies, there are 1325 pending and under contracts. That number is similar to a summer-time figure in 2007. But in summer 2007 there were 7000 listings to choose from. There are less than half that many now. 

I had a buyer scoff at the concept of anyone paying over asking price for any property on Friday. Well, I’ve been involved in 20 written offers since December 1st. I have put together less than half of those. Thirteen have been multiple offers. 

I’m not saying the market has recovered. I’m just reporting what’s going on. 

Are you flippin’ serious? The Highest and Best is Back

Believe it. Or don’t. The Highest and Best is back.

For those unacquainted with paranoid REALTOR speak, the highest and best is this: “we are putting you on notice that we have multiple offers at this time for this property. All participants are encouraged to submit their highest and best offer by ____ (usually 4 pm MST) for submission to the seller (usually a bank) at the same time.”

Showing is better than telling. It is a hallmark of what Hannah and I do. We can’t tell you that there is a real estate recovery afoot. You have to believe personally that there is a real estate recovery. We have a conflict of interest: it suits our financial interests for this market to recover.

But we can show.

I have written five consecutive offers. Granted, all were on bank-owned properties. All five, my buyers have been on the losing end of the stick in multiple offer situations. These properties have been in EAS, N/E, N/W, BRI and Ute Pass. Five different areas. Ute Pass! This morning I called for an investor on a house that was the single-most disgusting condition home I’ve been inside in probably 8 or 9 years. It’s a steal, but you need to wear a HazMat suit in there. Latex gloves all over the floor on both levels are never a good thing. I called the agent to see if we could throw out something cheap. “Owner occupant or investor, I’ve got two from investors submitting this morning so it’s going highest and best later today” he growled.

Don't ask for the freezer full of steaks in inclusions. You'll lose.

We are completing the 2012 Annual Report. You can take a peak at the December 2012 Stat Pack if you like, but we are seeing double the buyer interest from December, and, believe it or don’t, a market that actually has 4 fewer listings for sale than it did January 1st. It’s a ten-year low in inventory. It’s five month’s of inventory in January. It’s flippin’ maddening.

Of course, the real estate community has been telling people this market was poised for recovery since May, 2006 (it tipped 3 days before, back in April, 2006). So if you’re reading this with a healthy dose of skepticism, I can’t blame you.

All I can leave you with is this: you will know the market has recovered when you see it in the rearview mirror. And yes, I coined that phrase four years ago.