Bully Offer!!!!!!

Over the last few years, real estate "lingo" has made its was into main stream dialogue. Everybody sounds like a "realtor". Dunno that this is a good thing?

I remember 5 years ago sitting with friends of ours out for dinner and my buddy's wife leaned over and said something to the effect...friends of ours have listed their house for sale. They've done a "preinspection". They're worried cuz they have some "knob and tube" wiring and may have "asbestos". They're "holding back" offers and hoping to get "multiple offers" on the bid date. Another friend of ours was told by their realtors to do a "bully offer" on a property they wanted, she explained.

I had to break down the dialogue with her over dinner. So we looked at each of her new found real estate words.
-Preinspection
Holding Back
Multiple Offers
Knob and Tube
Asbestos

Let's face it, most of the above are straight forward but she didn't do such a great job at explaining the knob and tube and asbestos part. I wish I could recall her exact definitions. Lucky for her, I sold her a new home with a warranty that didn't contain either of her concerns.

Of late (and I don't think its gonna last much longer at all)..the term "bully offer" has become all the rage.

Just so it's out there....a "bully offer" is as it sounds. A party really pressing to buy a particular home tries to bud everyone else in line. Typically the buyer agent contacts the the listing agent and a verbal offer is presented. The dialogue may be..."what would your sellers be happy with to avoid any further disturbances of having people coming in and out of their residence. What's their most suitable closing date and if my buyers put that on a piece of paper (offer), can we bang this thing out in an hour and put the sold sign up?" I don't want to put words in other realtors mouths, but that's about the crude dialogue as a buyer agent I'd have with the listing agent.

The Sellers may take the bait even if they've had tons of showings. The upside for them is they get a price and closing date that suits them. The inherent risk is what if 10 parties would have bid up the price even higher. And if a seller is out of town for the week for convenience, the arguement of making their life easier holds little water.

It's not fun as a buyer to fall for a house and work on getting your ducks in a row only to find out that there's a bully offer. One thing to make sure you are doing to safeguard yourself somewhat is to book a showing for the property on day 1. Out of respect, the listing agent should call any buyer agent who has booked a showing to see the property to update them of the news. But the listing agent can only do so, if they know you exist (a booked showing is the only confirmation of you).

Their are strategies at play in a bully situation and of course your experienced, savvy and charming agent will assist you with those.

In the meantime, I have seen some offer dates come and go that a few months ago would have sold firm that night. This should offer some optimism.

For those buyers who are being removed from the home buying process with sharper lending regulations and heightened rates, the rest of you buyers should find yourself in the months to come in an environment with more supply and less sharp price increases. Some light at the end of the tunnel?!?!

Cheers and as always if you'd like to speak, email me of find me thru my website at http://www.TheSmithsBuyAHouse.com