Real Estate News About Woodbridge Virginia and Surrounding Communities: Woodbridge and Manassas Real Estate News It Is A Roaring Raging Sellers Market

THE GREAT BUYERS MARKET OF 2008 IS OFFICIALLY OVER

WOODBRIDGE, MANASSAS, BRISTOW, AND THE REST OF PRINCE WILLIAM COUNTY IS ON FIRE

HOMES ARE PRICED 40% BELOW 2005 PRICES

MULTIPLE OFFERS ARE NORMAL, BIDDING WARS ARE PUSHING PRICES DRAMATICALLY HIGHER

EVEN IF YOU BID $30,000 OVER THE LIST PRICE, YOU ARE STILL GETTING HOMES 30%-40% BELOW 2005

You can get a good house, at a bargain price, but be ready to offer your highest-and-best offer.  As a colleague said last week to his buyers, "Offer your 'No Regrets' price", meaning you will not regret if you lose the bidding because you held back from offering your highest-and-best price.

I wrote three offers this week for home buyers.  All three saw the actual sales prices for homes in the same neighborhoods, but all three hesitated offering top-dollar, even though they could do so, and they each considered doing so.

All three families lost to folks who bid higher.

The latest example is a townhouse with a garage for sale in Bristow, listed at $235,000. 

We looked at the listings for the last three similar homes in the same neighborhood.  Those homes sold for $250,000, $256,000, and $259,000.

The buyers kept saying to me, "That cannot be so.  How can that be?  Why would anyone in their right mind pay MORE than the list price?"

The remarks in two of the SOLD listings said the homes attracted multiple offers, creating a auction effect.

In fact, I called the listing agent for the home the couple wanted to buy to find out if the house had other offers.  "Yes.  I have eight (8) offers in-hand, and more on the way."  Naturally, the listing agent may not reveal the best offer in hand because it is to the benefit of the seller to keep that figure private so as to fetch the highest price possible.

You might ask me, "Erick, what should we bid to get the house?"

In the past, I have simply said, "Make an offer that you believe is fair, with which you are comfortable, now that you have seen the SOLD listings telling you the actual values sellers are getting.

I made the mistake of quoting a figure to a couple early in my career.  They offered that number, lost the house, then immediately looked at me with scorn and said, "Hey Erick YOU SAID that was the price to offer, and YOU were wrong.  We lost the house, AND IT'S ALL YOUR FAULT!!"

Since then, I have stuck with what I said above... make an offer with which you feel comfortable.  It's YOUR money.  I have no right to spend your money."

Well, I have a new "2009 Answer" to the question, "Erick, what should we offer?"

Here Is My Answer
"You can see in the records that similar homes were listed for $XXX,XXX, and sold for $25,000-$35,000 higher than list price.  That's still 30% below 2005 prices.  So your offer needs to be $35,000 or more over the list price."

"Forget list prices.  List prices are meaningless.  Focus 100% on the SOLD prices."

"But Mr Erick, Mr Erick!!!  We don't want to go THAT high over the list price.  What if we offer $10,000 over the list price?"

I reply, "Do you want the house?"

"Yes Mr Erick.  We want it, we want it really bad!!"

I reply, "Like the other homes that sold, be prepared for a bidding war.  $10,000 over won't win.  Take the highest SOLD price, then decide how high you want to go above that price.  $5,000?  $10,000?"

SO WHAT'S THE POINT?
If you're a seller, jump for joy!!  Price your home to attract lots of bidders, then let the auction effect work for you.

If you're a home buyer, forget what Daddy told you about "talkin' the down"; focus on the highest recent SOLD price, then bid over that number and pray; it's urban warfare out there; the market is cruel; get over it; if you gonna play, play to win.

"But Mr Erick, Mr Erick!!  I don't want to get into a bidding war for a house.  How can I avoid a bidding war?"

"Simple, " I say,"keep renting for another year or two so that our current pent-up demand for houses abates, wait for the market to push prices up high enough to slow demand such that bidding wars are over.  Wait until homes selling for $250,000 today are selling for $350,000; wait until homes selling today for $510,000 are selling for $625,000, and you'll avoid the bidding wars.

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Erick Blackwelder or Peggy James of Erick and Company - Exit 1st Choice Realty, Woodbridge VA. Realtors®, call 703-590-2252  list your property for sale or to  purchase a property in Lake Ridge, Westridge, Old Bridge Estates, River Falls, Middle County, Cannon Bluff, Meadowbrook Woods, Blooms Crossing, Manassas Park, Beaver Creek, Hunter's Ridge, Brittany,  Manassas, Montclair, Dumfries, Occoquan, Dale City, Nokesville, or anywhere in Prince William County.