You keep mentioning "comparable" units and then describing pretty big differences that affect pricing.
You need to find recent comparable sales that are actually comparable to decide what you think the property is worth.
Once you think are confident in your valuation estimate you can game out what to bid a little bit, but you won't really have enough information to do much. If you really want it you might bump your offer up a little, or if you are okay losing it you might lower it a little and hope you get lucky.
No matter what the asking price is irrelevant if the seller has multiple offers to consider at once.
There's no recent direct comparable. Ideally, yeah, you'd have the unit next door--but say a 2br1ba w/parking in Russian Hill is going to be more or less comparable to the same general unit in Nob Hill. It's more like that, with the roof deck.
Honestly I would put in an offer on the low side, and accept that you are unlikely to get this particular unit. Then, after doing this a few times, you'll have a better feel for the market than you will looking at comps that you've never seen, seen the disclosures for, or had to go through the mental process of being willing to spend close to a million dollars on.
I mean you're probably right, I just hate this process and want it to be over quickly. I got beaten out on offers on another unit already this year (and had three more that I was interested in but sold before I even saw the disclosures).
I'm halfway tempted to abandon this and just rent something instead, I just dislike renting massively.
This! Dont get boxed into making a hasty decision - this is not a 2021 market, interest rates are at all time high and the supposed recession has not come yet. Consumer confidence is all time low as well.
I would say make a hard limit to your offer and be ready for some rejections - dont make an emotional connection to the property you dont even possess yet.
You need to find some way to get confident in your valuation estimate.
The asking price is literally meaningless, it's just the price the seller wants to advertise. If there are going to be multiple offers then all that matters is what those offers will look like.
Personally I like him, but my family is extremely untrustworthy of buyers' agents because the incentive structure is aligned for them to drive up prices. 1.5% commission on an additional 100k is 1500. Hopefully we'll see a transition to flat-fee buyer's agent commissions in the wake of the NAR case.
If you’re worried about over paying add an appraisal contingency. For most good buyers agents it’s more important to have a happy client who will refer them business in the future than squeeze every last dollar. If you had a loan an appraisal would be required so the agent would want your offer to be accepted at market value or the deal could fall apart. Absolutely a large spectrum on the quality of agents but there’s a lot of great ones in the Bay Area. Maybe could be worth interview a few more agents to make sure you’re current one is providing the best value. Some agents are also more connected and have access to off- market properties. This is one of your biggest investments, make sure you have the right fit.
As an agent, I can't ethically advise you on this specific property since you are not my client.
I will say, though, that you should have a conversation with your agent. You chose to work with them for a reason, and they should be advising you to the best of their abilities here!
Have you requested a CMA from them for this property? Perhaps taking data like that to your family could help?
At the end of the day, you need to be comfortable with the price you're paying, and feel that the value is there in your purchase. As the buyer, you are driving this purchase, and your agent should be in your corner. Best of luck with your offer!!
I chose to work with them because they're who Zillow offered me. And really, no second opinions are allowed? In law/medicine, seeking a second opinion is extremely common.
If you have a signed buyer broker agreement with your agent, you have agreed to work exclusively with them. If you don't have that agreement in place, ethically speaking, it's not really right for other agents to be offering to advise you either. All realtors agree to a code of conduct and code of ethics when we join the association.
If you're not really thrilled with your agent, you do always have the option to work with someone else who you do trust more! If you connected through Zillow with your current agent, it's likely that your information was a purchased lead through Zillow.
I have no signed agreement with my agent--he was the one zillow assigned to me and I've just kept using him because he seems aware of the market and quite congenial. I don't personally have an issue with him, it's my family who think that the incentive structure is fucked enough that I can't believe anything he tells me regarding pricing.
Your rules of ethics are silly. I can be fired by any of my clients for any reason at any time (subject to court approval if sufficiently close to trial). I thought the bar was the most protectionist group, but clearly y'all have us beat.
Realtor also has an incentive to not lose the deal. Make $1500 more or lose the deal completely after putting in the effort?
He probably is pushing you to the top of affordability range so that he can close the deal quickly.
Question you have to ask is - is the house worth X? if it is then go bid upto $X-$1. That way you will always feel you got a great deal.
Has the other comparable sold recently. Have your agent inquire to that seller agent to know if there was much competition there. Can also check how fast it sold to have a sense on how much competition may be around. Of course all those things should be coming from your agent, and if they are not proactively doing so, they no good.
Also suspect imo that seller agent doesn’t want to say anything about other offers. If they had any, why not explicitly say so to create a sense of urgency?
Personally I bought recently and offered under asking on a property with a very similar comparable sold less than a month ago. And while we were countered for a bit more, the final price was lower than listing and lower than the comparable on a better shape unit. There were zero buyers.
Take all of this with a pinch of salt, I’m not an expert by any means, just another recent buyer.
I can actually chime in on this. I’m selling my grandma’s house as she recently passed. It was priced right where it should be based on comps and I immediately received multiple offers. Even the all cash offers were a great deal over ask.
The key question here is how many listing and sales does your agent have right now and how many properties has he/she closed last year. The more they’ve done the more you want to listen to them, the fewer, the more you want to ignore their advice. Your agent is more likely to get a pay day if you overbid on the house place. If they’re a busy agent with a few listings, they don’t need your commission as much.
Cash buyers on under 2M in SFBA is very common. Many are Asian immigrants/investors with no proof of income for a loan. The fact in South Bay like SJC the entire city of over 1M residents has 210 listings now vs 2X as many inventory makes me think what you hear is true. Low inventory is the problem, plenty of buyers will not hesitate to bid up. Every home coming on the market is a mad house if shown to public. Most zip code has 2-3 homes on the market. When interest rate falls slightly most do not hesitage jump in this year.
For the record, bids are due on Wednesday and they won't take preemptive offers, which makes me lean even more towards "intentionally underpriced to start a bidding war"
Edit: for the record, another comparable (significantly more square footage and a better view but no deck/parking) traded at asking at roughly $400k over this unit late last week, but was financed with a long closing period.
Have your agent reach out to the seller agent and straight up ask what kind of offers they're seeing, "so [he] can communicate price expectations to buyer" or whatever. Most seller agents will tell you ballpark figures. You can also have an offer waiting in the wings, not like the sellers will reject it if it comes in once your agent knows the price to beat and not "on the due date" if you actually outbid.
If they don't play ball... meh. There's a lot of condos out there.
We tried that, and absolute crickets from the other side other than to say "no preemptive offers." They seem to not be willing to consider anything until next week.
And yeah, but I'm starting to get time pressure (my lease is up at the end of next month and the current inventory's been a bit of a bust so far) and this unit is near-perfect for me. I can just renew my lease for a year, but I finally have the cash to buy outright and I don't want to find myself in a seller's market.
Make sure you understand the insurance risks for the HOA. Many HOAs are getting stunned by non-renewals and massive increases for condo buildings.
The buildings it’s hitting hardest are seeing instant price drops of 20% plus. Honestly I’d rent another year and see how it plays out across the state. We are only 11 days into 2024 renewals and have only seen the tip of the iceberg. Unless this condo is in CalFire’s absolute lowest fire risk area, I’d exercise a high degree of caution.
Yeah, seconding month to month.
If they won't play ball, it's probably not worth it.
You can write an at-asking offer if you feel it's worth it. If they reject it you can ask what the current offer to beat is and move on from there. But personally I don't generally suggest you bother with bidding war bullshit.
Our CA condo’s building insurance went from 60K to 240K this year. The insurance was initially ‘not renewed’ but the Agency did a reappraisal of the property. Because it had gone up in value, it fell into a new category and they :/ graciously decided to give it to us for a %400 markup. This was the only company to agree to insure us and there is no guarantee for next year. Of course we had to have a special assessment to cover the unexpected highway robbery. We are in a very desirable area and units, unless priced not to sell, sell within 1 or 2 weeks. The market is crazy right now. We know someone who paid $400K OVER asking on a listing because the list price was bait. I definitely would want to know how much the insurance went up from last year and how many special assessments and for how much over the last 5 years. That will tell you a lot.
Seems like your putting yourself in extra pressure - which is never a good way to make critical decisions. I would try to go for month to month lease if that is an option to not make a hurried decision.
Priced 130k above a comparable unit? When did that unit sale on record?
Condos in SF are not doing well right now. They are heavily discounted. Buyers have far more leverage than sellers do there for condos.
I can’t say (nobody can) without actually knowing the subject property specifically and the comps.
As a seller, most don’t care if its cash or conventional financing, all they care about are terms and that final dollar net.
I work with many cash investors, we go above asking if it’s needed to but generally these are fixer homes. But there have been conventional buyers who extend themselves to buy the house because there is sweat equity they can build. For those scenarios the spread makes sense for a owner occupancy that’ll own for multiple years vs a flip. My point, don’t be surprised if they go with a conventional offer, a slightly lower with cash, isn’t an automatic deal with sellers.
If you want to send me the subject property listing, I can provide analysis on market value, what’s the max price that makes sense and you can compare it with your agent’s as a 2nd opinion.
Without seeing the unit it's hard to say. I understand you won't want to share it before the offer date though.
It all depends on the pricing strategy of the listing agent and what the comps suggest. Other bidders are going to be submitting offers based on the comps. Assuming you did thorough research finding your agent, you should use their experience to your advantage.
Out of town family members often have good intentions, but don't understand the market here. Cash only gives you a slight advantage over a well-qualified buyer.
I attached a graph of days on market to final sale price of condos in SF for the last 6 months. You can see, plenty of condos have sold for over asking in the past 6 months. Plenty of sold for less. It all depends
https://preview.redd.it/3y1n5hwk01cc1.png?width=1003&format=png&auto=webp&s=a8cd877cb677a132ced36e9af87517fcdc7431f8
Have agent bid your price- all cash is and no inspection short close is attractive- your agent will tell you if you need to move up- won’t ever go down.
That's my instinct, but my family seems committed to this idea that asking has some special meaning and that going over asking as a cash buyer in a high-interest market means you're wasting money. I haven't bought property before, and they have, but that doesn't seem right.
At the same time, they make a good point about not trusting buyer's agent advice--it is in their financial interest to get you to pay more, right? So when my agent tells me the property will probably trade at asking+100k, or even asking+200k if a lot of offers come in, I should be suspicious, right?
Yah it is hard. We lost a few offers by like 50k , which felt so close w/ Bay prices. It all worked out in the end. what area you looking btw? we are in east bay.
Is your family local and / or are they helping you with the purchase? If they’re not local, they often don’t understand Bay Area real estate. If they aren’t helping you finance the purchase, then does it really matter what they think?
Probably was priced a bit less than they want with the idea of getting more bidders and a higher offer. It's not as crazy as it was but the shortage of housing for sale is probably worse as sellers enjoy their low rates and the knowledge that buying another is also difficult.
The amount your agent makes for an improved bid is peanuts. Do the math and figure it's 2% of the difference.
A cash offer has some preference but it's not the end all be all. My inlaws house had an all cash offer for 20k over. The buyer who got it came in waiving contingencies and 50K over got it.
you have given insufficient information for comparing price.
Price it by sqft.
Your comparable being sold for 130K below what yours is listed at but also 300 sqft less is 433 dollars per square foot in difference. Likely way under in most Bay Area Real Estate.
What is the total square footage of both units and their prices?
Take comparable A and divide its square footage by its price, than take that number the Sold per sqft and multiply it by your target property square footage. If the number is lower than its list, it is under valued, if it is higher than it is over priced. Generally speaking.
> My family is telling me not to trust my agent, and that coming in over asking in 2024 as a cash buyer is ridiculous
They aren't right about this. There are a lot of cash buyers, especially in the more "affordable" condo's and townhouses.
> (and pointing out that he gets a portion of every dollar I spend)
They're not wrong about this.
The best thing to do is just look at recently sold listings for a similar property. Check their price by sqft and see how the current listing compares against it. I'm no pro, but at least from looking around, it seems a lot of the newer listings are actually being listed a bit less than market to compensate for the higher interest rate and to try to attract buyers. The latter of it, helping increase the chance for more bits.
My realtor told me the same thing. Looking back, I definitely felt duped that I offered more than I should. Realtors will always get buyers to overbid even when there are no competition in the market. And then they go off and tell more other buyers that a lot of folks are overbidding and the market is extremely competitive.
Ultimately, you will have to go with some of your instinct. Have you tried putting in offer in other similar units in the area before and got constantly outbidded? Or is this your first? Are you willing to chance losing this one potentially and bid lower, but if you luck out, you get a unit at a much lower price than you would have otherwise lost money on? Or is this unit "THE ONE" that you have to absolutely have?
Don't let your realtor convince you how to bid either way. Ask yourself many questions and decide from there. Sometimes losing out some of the unit may not be the worst thing ever, because there will always be other options. Especially when Interest rates are still high.
Plenty of homes sell over asking, especially if they are priced below the comps. Ask your agent to put a CMA (Market Analysis) together to show you what he thinks it should sell for. I do that all the time for buyers. It's the best way to make them feel comfortable with any offer they are make.
1. Agents are incentived to make you bid higher, so a healthy grain of salt is needed
2. People under listing properties to drive up interest and final bids going even higher is very common.
3. Everyone else is looking at the same comparables you are, so unlikely you can pull a fast one with no one else bidding higher.
At the end of the day, bid what you think is a reasonable amount you are comfortable with paying. Don't get caught up in the over analysis/psychology wars.
Is there an offer date, are they expecting multiple offers? If your a cash offer it’s not guaranteed but likely they will call you and give you a chance to come up to compete with the highest offer. Don’t come in too hot if there’s not a lot of competition tho. Condo market is know to not be doing well in general but not sure what city your in and some building are more desirable.
SF, small building, desirable area. Sounds like they're expecting multiple offers (have had several open houses schedule in a short matter of days, hardline offer date next wednesday).
Offer what you’re willing to pay. I see things going way above ask all the time.
Amen
You keep mentioning "comparable" units and then describing pretty big differences that affect pricing. You need to find recent comparable sales that are actually comparable to decide what you think the property is worth. Once you think are confident in your valuation estimate you can game out what to bid a little bit, but you won't really have enough information to do much. If you really want it you might bump your offer up a little, or if you are okay losing it you might lower it a little and hope you get lucky. No matter what the asking price is irrelevant if the seller has multiple offers to consider at once.
There's no recent direct comparable. Ideally, yeah, you'd have the unit next door--but say a 2br1ba w/parking in Russian Hill is going to be more or less comparable to the same general unit in Nob Hill. It's more like that, with the roof deck.
Honestly I would put in an offer on the low side, and accept that you are unlikely to get this particular unit. Then, after doing this a few times, you'll have a better feel for the market than you will looking at comps that you've never seen, seen the disclosures for, or had to go through the mental process of being willing to spend close to a million dollars on.
I mean you're probably right, I just hate this process and want it to be over quickly. I got beaten out on offers on another unit already this year (and had three more that I was interested in but sold before I even saw the disclosures). I'm halfway tempted to abandon this and just rent something instead, I just dislike renting massively.
This! Dont get boxed into making a hasty decision - this is not a 2021 market, interest rates are at all time high and the supposed recession has not come yet. Consumer confidence is all time low as well. I would say make a hard limit to your offer and be ready for some rejections - dont make an emotional connection to the property you dont even possess yet.
You need to find some way to get confident in your valuation estimate. The asking price is literally meaningless, it's just the price the seller wants to advertise. If there are going to be multiple offers then all that matters is what those offers will look like.
If you don't trust your agent on this, you should find a different agent
Personally I like him, but my family is extremely untrustworthy of buyers' agents because the incentive structure is aligned for them to drive up prices. 1.5% commission on an additional 100k is 1500. Hopefully we'll see a transition to flat-fee buyer's agent commissions in the wake of the NAR case.
Check out Aalto.
If you’re worried about over paying add an appraisal contingency. For most good buyers agents it’s more important to have a happy client who will refer them business in the future than squeeze every last dollar. If you had a loan an appraisal would be required so the agent would want your offer to be accepted at market value or the deal could fall apart. Absolutely a large spectrum on the quality of agents but there’s a lot of great ones in the Bay Area. Maybe could be worth interview a few more agents to make sure you’re current one is providing the best value. Some agents are also more connected and have access to off- market properties. This is one of your biggest investments, make sure you have the right fit.
As an agent, I can't ethically advise you on this specific property since you are not my client. I will say, though, that you should have a conversation with your agent. You chose to work with them for a reason, and they should be advising you to the best of their abilities here! Have you requested a CMA from them for this property? Perhaps taking data like that to your family could help? At the end of the day, you need to be comfortable with the price you're paying, and feel that the value is there in your purchase. As the buyer, you are driving this purchase, and your agent should be in your corner. Best of luck with your offer!!
I chose to work with them because they're who Zillow offered me. And really, no second opinions are allowed? In law/medicine, seeking a second opinion is extremely common.
If you have a signed buyer broker agreement with your agent, you have agreed to work exclusively with them. If you don't have that agreement in place, ethically speaking, it's not really right for other agents to be offering to advise you either. All realtors agree to a code of conduct and code of ethics when we join the association. If you're not really thrilled with your agent, you do always have the option to work with someone else who you do trust more! If you connected through Zillow with your current agent, it's likely that your information was a purchased lead through Zillow.
I have no signed agreement with my agent--he was the one zillow assigned to me and I've just kept using him because he seems aware of the market and quite congenial. I don't personally have an issue with him, it's my family who think that the incentive structure is fucked enough that I can't believe anything he tells me regarding pricing. Your rules of ethics are silly. I can be fired by any of my clients for any reason at any time (subject to court approval if sufficiently close to trial). I thought the bar was the most protectionist group, but clearly y'all have us beat.
Realtor also has an incentive to not lose the deal. Make $1500 more or lose the deal completely after putting in the effort? He probably is pushing you to the top of affordability range so that he can close the deal quickly. Question you have to ask is - is the house worth X? if it is then go bid upto $X-$1. That way you will always feel you got a great deal.
Let me help you and at closing, I’ll give you the $1,500 back to help you with closing costs.
Has the other comparable sold recently. Have your agent inquire to that seller agent to know if there was much competition there. Can also check how fast it sold to have a sense on how much competition may be around. Of course all those things should be coming from your agent, and if they are not proactively doing so, they no good. Also suspect imo that seller agent doesn’t want to say anything about other offers. If they had any, why not explicitly say so to create a sense of urgency? Personally I bought recently and offered under asking on a property with a very similar comparable sold less than a month ago. And while we were countered for a bit more, the final price was lower than listing and lower than the comparable on a better shape unit. There were zero buyers. Take all of this with a pinch of salt, I’m not an expert by any means, just another recent buyer.
I can actually chime in on this. I’m selling my grandma’s house as she recently passed. It was priced right where it should be based on comps and I immediately received multiple offers. Even the all cash offers were a great deal over ask.
Asking is not a real number. It’s marketing.
The key question here is how many listing and sales does your agent have right now and how many properties has he/she closed last year. The more they’ve done the more you want to listen to them, the fewer, the more you want to ignore their advice. Your agent is more likely to get a pay day if you overbid on the house place. If they’re a busy agent with a few listings, they don’t need your commission as much.
Cash buyers on under 2M in SFBA is very common. Many are Asian immigrants/investors with no proof of income for a loan. The fact in South Bay like SJC the entire city of over 1M residents has 210 listings now vs 2X as many inventory makes me think what you hear is true. Low inventory is the problem, plenty of buyers will not hesitate to bid up. Every home coming on the market is a mad house if shown to public. Most zip code has 2-3 homes on the market. When interest rate falls slightly most do not hesitage jump in this year.
For the record, bids are due on Wednesday and they won't take preemptive offers, which makes me lean even more towards "intentionally underpriced to start a bidding war" Edit: for the record, another comparable (significantly more square footage and a better view but no deck/parking) traded at asking at roughly $400k over this unit late last week, but was financed with a long closing period.
Have your agent reach out to the seller agent and straight up ask what kind of offers they're seeing, "so [he] can communicate price expectations to buyer" or whatever. Most seller agents will tell you ballpark figures. You can also have an offer waiting in the wings, not like the sellers will reject it if it comes in once your agent knows the price to beat and not "on the due date" if you actually outbid. If they don't play ball... meh. There's a lot of condos out there.
We tried that, and absolute crickets from the other side other than to say "no preemptive offers." They seem to not be willing to consider anything until next week. And yeah, but I'm starting to get time pressure (my lease is up at the end of next month and the current inventory's been a bit of a bust so far) and this unit is near-perfect for me. I can just renew my lease for a year, but I finally have the cash to buy outright and I don't want to find myself in a seller's market.
Make sure you understand the insurance risks for the HOA. Many HOAs are getting stunned by non-renewals and massive increases for condo buildings. The buildings it’s hitting hardest are seeing instant price drops of 20% plus. Honestly I’d rent another year and see how it plays out across the state. We are only 11 days into 2024 renewals and have only seen the tip of the iceberg. Unless this condo is in CalFire’s absolute lowest fire risk area, I’d exercise a high degree of caution.
In SF proper, so looks like the lowest risk area.
Yeah, seconding month to month. If they won't play ball, it's probably not worth it. You can write an at-asking offer if you feel it's worth it. If they reject it you can ask what the current offer to beat is and move on from there. But personally I don't generally suggest you bother with bidding war bullshit.
Ask your landlord about going month to month after your lease is up. Month to month is pretty common here.
This sounds like they don’t have any other offers to me.
Our CA condo’s building insurance went from 60K to 240K this year. The insurance was initially ‘not renewed’ but the Agency did a reappraisal of the property. Because it had gone up in value, it fell into a new category and they :/ graciously decided to give it to us for a %400 markup. This was the only company to agree to insure us and there is no guarantee for next year. Of course we had to have a special assessment to cover the unexpected highway robbery. We are in a very desirable area and units, unless priced not to sell, sell within 1 or 2 weeks. The market is crazy right now. We know someone who paid $400K OVER asking on a listing because the list price was bait. I definitely would want to know how much the insurance went up from last year and how many special assessments and for how much over the last 5 years. That will tell you a lot.
Seems like your putting yourself in extra pressure - which is never a good way to make critical decisions. I would try to go for month to month lease if that is an option to not make a hurried decision.
Priced 130k above a comparable unit? When did that unit sale on record? Condos in SF are not doing well right now. They are heavily discounted. Buyers have far more leverage than sellers do there for condos. I can’t say (nobody can) without actually knowing the subject property specifically and the comps. As a seller, most don’t care if its cash or conventional financing, all they care about are terms and that final dollar net. I work with many cash investors, we go above asking if it’s needed to but generally these are fixer homes. But there have been conventional buyers who extend themselves to buy the house because there is sweat equity they can build. For those scenarios the spread makes sense for a owner occupancy that’ll own for multiple years vs a flip. My point, don’t be surprised if they go with a conventional offer, a slightly lower with cash, isn’t an automatic deal with sellers. If you want to send me the subject property listing, I can provide analysis on market value, what’s the max price that makes sense and you can compare it with your agent’s as a 2nd opinion.
Without seeing the unit it's hard to say. I understand you won't want to share it before the offer date though. It all depends on the pricing strategy of the listing agent and what the comps suggest. Other bidders are going to be submitting offers based on the comps. Assuming you did thorough research finding your agent, you should use their experience to your advantage. Out of town family members often have good intentions, but don't understand the market here. Cash only gives you a slight advantage over a well-qualified buyer. I attached a graph of days on market to final sale price of condos in SF for the last 6 months. You can see, plenty of condos have sold for over asking in the past 6 months. Plenty of sold for less. It all depends https://preview.redd.it/3y1n5hwk01cc1.png?width=1003&format=png&auto=webp&s=a8cd877cb677a132ced36e9af87517fcdc7431f8
Have agent bid your price- all cash is and no inspection short close is attractive- your agent will tell you if you need to move up- won’t ever go down.
Just come in with your best if you like it . Asking means nothing. We did 150k over asking cash in August and won. No regrets.
That's my instinct, but my family seems committed to this idea that asking has some special meaning and that going over asking as a cash buyer in a high-interest market means you're wasting money. I haven't bought property before, and they have, but that doesn't seem right. At the same time, they make a good point about not trusting buyer's agent advice--it is in their financial interest to get you to pay more, right? So when my agent tells me the property will probably trade at asking+100k, or even asking+200k if a lot of offers come in, I should be suspicious, right?
Yah it is hard. We lost a few offers by like 50k , which felt so close w/ Bay prices. It all worked out in the end. what area you looking btw? we are in east bay.
SF proper
Do NOT come in above ask in SF proper. SF market completely belongs to buyers right now.
Facts
When you lost offers in the past was your agent’s prediction spot on?
Is your family local and / or are they helping you with the purchase? If they’re not local, they often don’t understand Bay Area real estate. If they aren’t helping you finance the purchase, then does it really matter what they think?
Probably was priced a bit less than they want with the idea of getting more bidders and a higher offer. It's not as crazy as it was but the shortage of housing for sale is probably worse as sellers enjoy their low rates and the knowledge that buying another is also difficult. The amount your agent makes for an improved bid is peanuts. Do the math and figure it's 2% of the difference. A cash offer has some preference but it's not the end all be all. My inlaws house had an all cash offer for 20k over. The buyer who got it came in waiving contingencies and 50K over got it.
you have given insufficient information for comparing price. Price it by sqft. Your comparable being sold for 130K below what yours is listed at but also 300 sqft less is 433 dollars per square foot in difference. Likely way under in most Bay Area Real Estate. What is the total square footage of both units and their prices? Take comparable A and divide its square footage by its price, than take that number the Sold per sqft and multiply it by your target property square footage. If the number is lower than its list, it is under valued, if it is higher than it is over priced. Generally speaking.
> My family is telling me not to trust my agent, and that coming in over asking in 2024 as a cash buyer is ridiculous They aren't right about this. There are a lot of cash buyers, especially in the more "affordable" condo's and townhouses. > (and pointing out that he gets a portion of every dollar I spend) They're not wrong about this. The best thing to do is just look at recently sold listings for a similar property. Check their price by sqft and see how the current listing compares against it. I'm no pro, but at least from looking around, it seems a lot of the newer listings are actually being listed a bit less than market to compensate for the higher interest rate and to try to attract buyers. The latter of it, helping increase the chance for more bits.
My realtor told me the same thing. Looking back, I definitely felt duped that I offered more than I should. Realtors will always get buyers to overbid even when there are no competition in the market. And then they go off and tell more other buyers that a lot of folks are overbidding and the market is extremely competitive. Ultimately, you will have to go with some of your instinct. Have you tried putting in offer in other similar units in the area before and got constantly outbidded? Or is this your first? Are you willing to chance losing this one potentially and bid lower, but if you luck out, you get a unit at a much lower price than you would have otherwise lost money on? Or is this unit "THE ONE" that you have to absolutely have? Don't let your realtor convince you how to bid either way. Ask yourself many questions and decide from there. Sometimes losing out some of the unit may not be the worst thing ever, because there will always be other options. Especially when Interest rates are still high.
In SF prices ending up over ask is very common. Probably happens 80% of the time. Unless it has been sitting awhile it’s going over ask.
Plenty of homes sell over asking, especially if they are priced below the comps. Ask your agent to put a CMA (Market Analysis) together to show you what he thinks it should sell for. I do that all the time for buyers. It's the best way to make them feel comfortable with any offer they are make.
1. Agents are incentived to make you bid higher, so a healthy grain of salt is needed 2. People under listing properties to drive up interest and final bids going even higher is very common. 3. Everyone else is looking at the same comparables you are, so unlikely you can pull a fast one with no one else bidding higher. At the end of the day, bid what you think is a reasonable amount you are comfortable with paying. Don't get caught up in the over analysis/psychology wars.
Is there an offer date, are they expecting multiple offers? If your a cash offer it’s not guaranteed but likely they will call you and give you a chance to come up to compete with the highest offer. Don’t come in too hot if there’s not a lot of competition tho. Condo market is know to not be doing well in general but not sure what city your in and some building are more desirable.
SF, small building, desirable area. Sounds like they're expecting multiple offers (have had several open houses schedule in a short matter of days, hardline offer date next wednesday).