Multiple Offers abound again in Howard County Home Sales

.What causes multiple offers in Real Estate?  ‘Well, it all depends’ and if you know me, you know I say that often when it comes to Real Estate.   In today’s Howard County Real Estate Market (2013) one of the primary reasons is Lack of Inventory but, it’s not always the reason.  While the lack of inventory surely does help a seller (hurts a buyer), the home has to be priced at or near the market price and it needs to show well.  And of course, we cannot forget the golden rule of Real Estate of Location.  If a home is located in a desirable area, that will make more buyers come running.  More buyers usually equates to more offers!

For most homes in Howard County, you already have the Location advantage down due to the Counties location situated between Washington DC and Baltimore, the #1 school district in the state, plus the multiple Government and Contactor jobs in the area (current shut down aside).

However, with today’s market, many homes in Howard County can receive multiple offers if it shows well, is in a good location (often driven by the perceived rack of the schools), and is priced right.

Now that is not to say the sale price offered by potential buyers will always exceed the list price for ‘it all depends’ on a number of factors and largely it’s how close to a Sales Price is the List Price.

Keep in mind that most offers, in this market, will still be conditional on a Bank Appraisal (that is the buyer’s Bank’s perceived value of the home) and so many uncontrollable factors can impact the Home’s Appraised Value.  Like; how well does the appraiser know the market area?  Are homes around the home increasing or decreasing in value?  Are there many distressed sales (foreclosures, short sales and auction sales) in the neighborhood or area?  Does the home show well compared to other homes recently (usually 6 months) sold nearby?   So even if the Sales Prices comes in high, it does not mean the home will sell at that price if the bank does not agree (providing the offer contains an Appraisal Contingency Addendum).

In the past two years, about 70% of my sales and listings have sold with multiple offers and it can make the sales process stressful for all involved.  I currently have a ‘hot’ listing and have 6 offers that range above and below the list price by about 8%.  The offers all have various Settlement Dates, Good Faith Deposits, Financing and Home Inspection contingencies.  Of the 6, only two have an Appraisal Contingency and only 1 is totally waiving the Home Inspection.  While my seller has not decided which offer she will accept, I know 5 other buyers and their agents will be disappointed.

So, how do you ‘get the house’ in this market?  It all depends!  Talk to your agent and be flexible and if you really like the house, you may need to take a bit of a risk.