When you’re looking at buying a home, it’s very important to have your agent run comparables on the home before you decide on making an offer.
What we’re seeing more and more in this area is listing agents are purposely pricing the home low to get multiple offers. In many situations, we are seeing a $1 million home being priced at $600,000. It creates a craze among buyers who are looking at this $1 million home and thinking they can get it for $600,000.
The idea behind this strategy is that the listing agent and the seller want to create a multiple offer situation in which the potential buyers are trying to outbid each other and end up going over the actual price of the home.
Comparables, or “comps,” are properties that have sold that are like-kind in your area in the last 60 to 90 days. If you’re buying a home in the area and you want to make sure you’re putting in your highest and best offer, make sure you have your agent run the comps on that home to know what it will actually sell for.
Doing this also helps you anticipate what kind of offers you may be competing against for the home and helps establish a reasonable market value for the property.
To set yourself up to get the best outcome as a buyer or a seller, make sure you’re doing your homework and having your agent working for you to find these things out ahead of time.
If you’re looking to buy or sell a home or you have any other real estate questions, please don’t hesitate to give me a call. I’d be happy to help.