If I offer list price on an IRVINE home, will my offer get accepted?

by Robert Mack on August 6, 2009

in Irvine Real Estate

You would think that if you made a full price offer your offer would be accepted, however this is not always the case.  With the number of closed and pending sales up for the 5th month in a row and the fact that the number of new listings is dropping, all of this is creating a demand issue.  There are 3 common types of sales that we are experiencing in the Irvine, California market place right now. 

  1. Standard re-sale – This type of sale is when you deal with a real life seller, one who has equity and can respond quickly to an offer.  This type of sale is very attractive to the prospective buyer since there is no additional waiting time to hear back from the seller on an offer that is submitted.  For this reason, many buyers are willing to pay over the listing price, just to avoid the wait and in many cases, the seller and buyer may even agree on a price for the home where it won’t even appraise.
  2. Foreclosure – This type of sale is the most popular, since a foreclosure home is associated with “GREAT DEAL”.  In almost every case, the banks will list these repossessed homes at 5 or 10% below market, just to generate multiple offers.  Their intention is to be able to have the pick of the litter and choose the most highly qualified buyer from the multiple offers.  It is not uncommon for a bank owned home that is priced aggressively to receive any where from 20-80 offers within the first week of even being listed. 
  3. Short Sale – This type of sale is the most “hated” type of sale.  The lender must approve this sale, and their overall net.  For this reason, the bank wants “MARKET VALUE” for the home. Regardless of what is owed or how late the seller is on their payments, MARKET VALUE is what makes sense to them.  In many cases, a listing agent may price the home below market just to create the “FORECLOSURE FRENZY’ which commonly happens with the bank owned homes.  This however can result in a rude awakening for the prospective buyer if their offer is based off the list price. 

So, you may ask yourself, “how do I avoid this happening to me?”.  Well the bottom line is to have your agent determine market value.  This way you will not be wasting your time submitting offers that just won’t get accepted.  Whether it is a foreclosure, standard re-sale, or a short sale, it is always best to determine fair market value, and base your offer off of that.

If you have any questions or would like to determine fair market value for any home, please contact The Mack Team at (949) 209-7309 or through the contact tab on this blog!

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