Hi,
I was wondering if others have had the same experience, where the realestate agent has tried to get a bidding contest going on a property that’s listed for sale, not auction. I inspected this house that was new on the market, then I put in my written offer. The next day the R/E agent called and said he had just received another offer, but of course he couldn’t tell me for how much But if I raise my offer I might have a better chance. I asked him that I thought only one offer could be put to vendor at a time, he replied nastily that it was a sellers market and that he should get top $ for the vendor. When I replied that my offer was put in a day earlier, he told me he hadn’t submitted my offer yet, because he was busy. I should add that my offer was only $5000. less than asking price as I thought it a fair price. [
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It seems to me that the market has jumped $20,000 this past week, in my area and unless you pay asking price that’s it.no go.
Are others experiencing this also?
Sandi []Hi Sandi,
Sorry to hear about your situation but it’s true that the agent is acting on the vendor’s behalf and should be getting the best possible price for his/her client.It sounds like your offer was very fair, though you don’t mention what the easking price was. I guess it would make a difference if the property was listed at $70,000 or $420,000.
I’ve felt the market here (inner Melbourne) is flattening out a bit and wouldn’t say it’s a sellers market like it was 12-18 months ago.
If the agent is saying that the $5k less offer won’t cut it, ask him what will. Perhaps $4k less?
If you really think this property stands on it’s own with the figures and makes a good investment, perhaps a higher offer is worthwhile?Can you please tell us which area you are talking about and what the asking price of the property is, as it may enable some forumites to provide you with a better reply. Some figures on rent return may also help us to provide a better reply.
Hi
Just thought i’d give my two cents i just bought a property and i offered $38’000 for it they came back and said that if they where to take that offer it would be as is and I said thats all right then the agent got to talkin to me more and I (stupidly) said what the maxium i’d pay for it so of corse they went to that price but I’ll learn from this experience.
Thanks Rob[8D]
Hi,
The mentioned property is in Millicent, SA. The price was listed at $65,000. Rented at $125.p/wk.
Now it’s withdrawn and apparently going to wait a week and re-list it at $87,000. I didn’t get to inspect it but if it’s rented at $125 I’m guessing it must be liveable.
I didn’t like the bidding contest.[] But if he is genuine and there is another person then I suppose it is also in my interest, to up my bid. However it just made me feel uneasy and pushed.
Also the problem is there aren’t that many properties for sale under $100k,and this has pushed the prices UP UP UP! in all the south east of SA.
Thanks,
Bye
Sandi. []Just a thought… when you made your offer what did you base your calculation on? If you are purchasing a house for youself to live in 5k is probably neither here nor there. However if it is purely an investment then you will have done your calculation of what you can expect to receive as a return on your investment. The difficult thing to guage is if the agent was simply trying it on or if there was another genuine buyer. Nevertheless whatever the case maybe you did your sums based on your returns. If another buyer is able to make an acceptable return even though they pay $5k more that is their good fortune. The other buyer may for example have access to finance at a lower rate than you have been able to source or may have a different strategy. So for what it’s worth I’m suggesting that having determined what you believe the property to be worth don’t let an agent push you for more.
As a matter of interest I recently sold a property – I had three very similar offers and sat around the table as the agent rang each of the buyers to ask if (in the light of there being two other bidders) the person would like to increase their offer – I’d expect it would be a common ploy by agents.
Cheers,Hi Sandi,
As a former real estate salesperson your post brings to my attention a couple of points. These points relate to how I operated in NSW and may not apply to SA but here goes.
1. Your written offer by law should have been submitted to the vendor regardless of how busy the agent was. This admission alone on his behalf could see him in trouble if you decided to persue the issue if you felt that you were disadvantaged by him not submitting it.
2. If your offer is the first one recieved on a property and a higher offer is said to be recieved, you have first right to refusal on the new offer and subsequent higher offers. The agent is obliged to tell you the new price and if you can match it you get to buy it. This is assuming that the vendor has agreed to the higher of the 2 offers initially and the second party do not put in another offer (they are not entitled to know that you matched it, only that another offer was accepted and they are welcome to make a new offer).
Of course not all agents work in this way as they do get into a bidding war on a property offered for private treaty instead of an auction. But I guess there is no way to stop it from happening.
Cheers,
Matt.
Hi,
Thanks for your replies.
I am still amused by that agents conduct, I think he should not be in sales or deal with people.Live and learn. By The Way I agree that vendors should get highest price, it’s just not knowing IF there is another bidder or a phantom? There aren’t that many properties on his for sale books.
I have since found a better sales agent to work with.
Happy Investing to All.
bye,
Sandi []Sandi,
I understand the situation you are in. 6 months ago I made an offer on a property in NSW listed at $210,000. The real estate agent told me that they already have a offer but the vendor and not accpeted it. I made my offer of $205,000. The agent told me that the other offer was higher and would I like to raise my offer so I offered $210,000 the agent took that offer to the vendor. Within 15mins the agent called and said that the other interested party had matched my offer would I like to raise my offer, so I did to $212,000 over the next 1 many phone calls were made and my final offer of $240,000 was accepted by the vendor.
After this I spoke with a friend of mine who is an agent and I told her what when. She informed me that I was participating in what is called a “dutch auction” and that within NSW they are illegal but no body regulates it.
You will be happy to know that I did not follow through on the deal. The very frustrating thing is that you dont really know if there is another buyer.
Regards
Lucinda,
Coffs Habrour NSWLucinda
your post illustrates what I was saying earlier – if the property fitted your investment criteria at $205k how could it possibly have fitted at an additional premium of almost 15% ($240k) unless of course you had a buyer all lined up at a significantly higher price. I’m glad you didn’t let the agent suck you into going through with the purchase.
Cheers,
SteveGday Lucinda, l was wondering after your offer of 240K was accepted by the vendor,why you did not follow through on the deal ? MITCH
Gday Lucinda, l was wondering after your offer of 240K was accepted by the vendor,why you did not follow through on the deal ? MITCHThe property needed some major renovations (the renos would have costed about 50k). My Husband and I felt that we would be over capitalising and the risk of not getting the return we were after was to high.
Gday Lucinda,
so your decision to renege was nothing to do with the Agent? You changed your mind after the vendor accepted your offer becouse the risk of not getting the return you were after was too high ? MITCHHI Sandi,
This happened to me, the first time around and I was ‘green’ behind the ears ( so to speak).
I would do something very naughty. I would look at the contract of sale, find out the owners name, do the research (yellow or white pages) and drop them a line, saying that due to the ‘questionable’ actions of their chosen agent, you, as a potential and hopeful buyer are being scared away by his tactics and thereby the vendor is missing out on a potential buyer.
Actually, I wouldn’t do this, as it’s pretty dirty stuff and that would just lower my ethical standards.
At the end of the day, the agent is just trying to increase his profit margin on your and the vendors wallets. What he’s doing is legal, just very painfull. If it doesn’t feel right, walk away.Cheers and better luck next time.
Soosh [
]There are no problems, only solutions
Hi,
A couple of observations…
1. A buyer’s (or a seller’s) market won’t last forever.
2. Your situattion might be helped by including a 24 hour ‘sunset’ clause in our offer… in that the offer lapses if not put infront of the vendor.
3. Point out that you are looking at multiple properties and the vendor that replies first will be assured a sale. That is, create some urgency for the agent to get the offer in.
4. Never deal with this agent again. I have made it a rule to only deal with agents of integrity and I’d rather not buy than give some smuck a commission. Find a property that you’d like to buy and then get your agent of choice to act on YOUR behalf when dealing with the dodgy brother.
Bye,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
great reply by steve,yes we ahve all ecountered this phantom auction technique and this is how you get around it.
make an offer a written genuine offer.
and ask that you will sign the offer and the contract in the office ,but you require the vendor to be there to countersign.
if the seller believes you have a good price he will sign ,game over.[]
Gday Lucinda,
so your decision to renege was nothing to do with the Agent? You changed your mind after the vendor accepted your offer becouse the risk of not getting the return you were after was too high ? MITCHYes it did also have to do with the agent. We have not and will not purchase or sell a property through this agent. The funny thing is that they are the best property managers in our town and they manage all my properties.
and ask that you will sign the offer and the contract in the office ,but you require the vendor to be there to countersign.I think I’m missing something here… What’s the purpose of this? So you can negotiate with the vendor face to face? So the agent can’t make up phantom bids?
Hooooo boy. Back to bed, Quasimodo! [
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Funny how action has a way of answering all of our fearful questions…
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