Multiple Offers

by Darrin DeRoches May 1- 7, 2014

It’s the time of year for the event of bidding wars which bring multiple offers. Many agents try to drive up the price by “holding back” offers until a certain date and create multiple offers. The problem is that it can also backfire on you and actually cost you money.  This past week my clients looked at three properties that came on the market with a fixed date for offers.  All three were good homes and two of them should sell over asking.  The dates for offers came up and all three agents called me to see if we had any interest on making an offer and the funny thing was, all three had only one offer registered.      When you get into a multiple offer situation, you must call the brokerage and “register” your offer and then the agent will present “all offers” at a determined time.  The properties were all priced properly but many people in Hamilton do not want to get into a “bidding war”.  The fact that there were not more offers registered and the agents were calling around trying to drum some up makes the whole industry look a little desperate.  There was a story about a property going 195% over asking and everyone gets excited that the market has gone crazy and you can sell your property for top dollar.  The problem with this agent pricing the property was it was priced at a selling price from 15 years ago.  The property got a ton of attention and it also brought 70 plus offers but what did that really prove? Yes, there is a shortage of listings and obviously there are a lot of buyers out there looking for a property but the buzz he created was exactly that – created.     If I was to list a property at a price level from 15 years ago, it too would create a buzz in the Hamilton market but that buzz would be other agent talking shit about me. It would actually hurt the sale of the property and it may even garner a lower sale price.  Everyone keeps saying the “Toronto buyer” will come in and pay the higher price but that is total bullshit and if their agent is even remotely good and can work a computer they will realize it is overpriced and move on to another property.  A properly priced property will create its own buzz in this sellers’ market and garner multiple offers which will hopefully result in a great price and a quick sale.  If your strategy is to get multiple offers and your agent comes up with these far out strategies — kick them out of your house.  A home located in the west end will not sell the same way as a home on the mountain. Different buyers react to pricing and buzz in many different ways so what works in Toronto will definitely not work here.  V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.