Well, if you thought bidding wars were a thing of the past... think again! Homebuyers here in the Tampa Bay area are finding more competition when trying to find their dream home. The problem is that buyers are getting frustrated that this is the current scenario.Why are things getting so competitive? There are several factors that have fueled the increase in multiple offers during the first quarter.
1) Low inventory of homes for sale. [ See Absorption Rate Blog ] In Pinellas County alone there has been a DECREASE of 44% less inventory of homes or condos for sale, leaving homebuyers with fewer options and more bidding on the same property! During March, absorption rates moved over 20%!
2) Record low mortgage interest rates remain around 4%. It appears the Feds will support this rate for at least two more years making financing very attractive when combined with a great deal.
We have 3 real life examples going on at this very moment here with The PURTEE Team:
1) We listed a 3-bedroom beach front condo in an extremely popular 7-day rental complex in Indian Shores. The unit is bank owned and was listed at a "sell quick" price of $399,900. In less than two days there were multiple offers involved. Bank called for highest and best and accepted the highest offer... leaving the other 6 buyers high and dry, along with all those who simply hadn't made time to get an offer in. The sense of urgency is bank!
2) In Clearwater Beach there are a very limited number of condo complexes that allow weekly rentals making them highly desirable. Over the past couple of years, several units in each of these complexes have sold at highly distressed and de-valued prices. However, there was NOTHING available in any of these buildings. With the pent up demand, we listed a condo in one of these buildings on Tuesday of this week. It is a corner unit with solid rental history in place, fully furnished, over $10,000 in future bookings, a repeat renter group and two live and fully operational rental websites for the unit. It was listed at $485,000... $35,000 higher than the highest recent sale. For every realtor or buyer who is calling arguing about its price, there are two others trying to see it. This one will set a new bar in price and guess what... the next buyer will wish he got it at this price!
3) We submitted a full price buyer offer for a bank owned property that was listed at $39,250. Needed quite a bit of work but a lot of potential. 3 offers came in and were submitted to bank. Bank called for highest and best yet they held the property open for additional offers. This one is still in 'wait and see' mode.
The point is... read our blog about Low-Balling Offers. If you are a buyer or investor looking for a great property, USE A REALTOR AND FOLLOW THEIR ADVICE. You still may not get the property in this situation, but you at least have a fighting chance. The next tier of listings will come as sellers begin to enter their properties at non-distressed but still value packed prices. PURTEE advice: don't miss out!
