Something to consider as a listing agent and as a seller……The highest offer may not always be the best offer. It would be in your best interest as a seller to have back up offers in place in the case the chosen offer cannot close. Lately we have seen several escrows cancel because the buyer’s appraisal has come in lower than the offer price. Many buyers do not have the ability to bring in cash when the appraisal does not support the offer price.As a seller it is wise to check comps and chose an offer that is fair market value to reduce the risk of time wasted on a offer that cannot get financing due to the appraisal.
There is a buzz in the air that home prices are increasing. Current inventory is extremely low which is forcing bidding wars on listed properties, however, we are not even close to being out of the depressed market we are in and the appraisal regulations will not allow for a huge spike in values.
A buyers lender will only lend on the appraised value of the home, regardless of the sales price. There currently is a shortage of homes for sale in Orange County and it is only to worsen in the year to come. I read an article this morning in the Orange County register written by Jeff Collins that indicates the housing inventory has fallen to an 8 year low.
Orange County had just 3,753 homes for sale as of Thursday, the smallest number on the market in the eight years that Steve Thomas of ReportsOnHousing.com has been tracking the county’shousing inventory.
Thomas said the active listing inventory dropped 24 percent below the prior low established in March 2005, when there were just 4,912 homes on the market.
Listings have been dropping because fewer homeowners are putting their properties up for sale, Thomas said. In addition, the number of bank-owned foreclosures has been dwindling over the past year.
Thomas warned, however, that home sellers shouldn’t see the current market as an opportunity to cash in. Buyers are not going to pay an additional 10 percent above the last comparable sale because are appreciating at a very slow rate, not thousands of dollars every month.
“Regardless of the craziness of today’s market, buyers are still not ready to pay well above recent comparable sales,” Thomas said. “Instead, prices will gradually increase.”
The TriStone Group
Seven Gables Real Estate
Short Sale Division Manager