Bidding Wars Back?

Amazingly enough, it seems that bidding wars and escalation addendums are rearing their ugly heads once again - at least in some arenas. I would like to address why I think this is happening, as well as how it affects buyers and sellers.

As we all know, buyers have been waiting and waiting and waiting for the market to hit bottom. Well, it would seem that a lot of buyers are starting to think that the time has arrived - and they are keeping a very sharp eye on new listings and price reductions. I am working with primarily two types of buyers - investors looking for properties in and around $200K and people looking for their dream home for $500K. Both of these types of buyers are looking for the best deal they can possibly get - the biggest home in the nicest condition for the lowest price. And when one of these beauties comes available - the bidding wars are on!

What does this mean for buyers? If you are looking in a popular price and style type, be prepared to have to outbid other buyers. It is not uncommon to go above list price in these situations. Set a maximum and put your bid in, but don't get your heart set on a property or you are asking for a let down. Be prepared to have to bid on multiple properties as well - you can't win 'em all. Does this mean you should avoid searching - probably not. If going above list price by $5K is still $40K lower than what you would have spent the last time you were ready - then you're still getting a deal!

What does this mean for sellers? You will now be able to sell your property - and quickly - if you price it attractively and stage it well. It's probably better to list now, before everyone else decides to list as well in the spring. The sellers have been waiting, too, believe it or not.

Disclaimer - I do not claim to be able to predict the future. The ideas I have discussed here are based on recent direct experience in the Reston/Herndon VA markets only.

If you have any questions about the market or are interested in getting new listings and price reductions automatically e-mailed to you (as frequently as you wish), I would be happy to help you. Just shoot me an e-mail.