The New Competitive Bidding

The term “competitive bidding” has taken on several new meanings in the fall of 2008.  First, there are those very well priced units which excite multiple offers. Yes, that is still happening! Here’s the difference: instead of having the offers soar over the asking price, they approach but don’t meet it. Several Warburg agents and their customers have won bidding wars in the last couple of weeks by coming up to 2 or 3% below ask. That is the new paradigm.

The other form of competitive bidding we are seeing, less successfully, is those buyers who bid against themselves. They make an offer, then lower it when it is accepted. We have also seen several examples of THAT recently in the Warburg community. Those offers do NOT result in deals. In both cases we saw last week, the sellers were not interested in the newly reduced offers and found other more straightforward buyers with whom to proceed.

So here’s my recommendation: if you are an active buyer in this marketplace, work with your agent to decide what price makes sense for you on the property you choose. Figure out a strategy to get there. And if you succeed, don’t second guess yourself.  Enjoy the fact that you have bought your new home for a terrific price.