It has happened to several of my clients lately -- we have made a full price offer with reasonable contingencies (home inspection, radon test, appraisal, financing) and we have lost out on the house.
What does it, or might it, mean?
- Many segments of our local market are significantly undersupplied -- so as to say that there are many more buyers than sellers in the market. Thus, there are often lots of early showings and multiple offers. So, the main reason why a full price offer is not winning is because we're competing with other motivated buyers.
- We can likely conclude that the other buyers made offers higher than the asking price -- or with an escalation clause which would automatically increase their offer above competing offers. So, it may be simply a result of being outbid.
- Some buyers are strengthening their offers by removing some "normal" contingencies -- such as the home inspection contingency, or the appraisal contingency. This doesn't necessarily make sense for most buyers to do, but it is something that we can discuss.
So, unfortunately, on a well priced new listing in a competitive price range -- seeing the house on the day it is listed and making a full price offer that same day won't necessarily mean you will be buying the house.
As such, it's a great time to be a seller. It's not necessarily as exciting to be a buyer right now.
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