full price offer 2 days before house open to public

full price offer 2 days before house open to public

Dayton, OH · Member since 2014 · 52 posts · 5 votes

wanted to get opinions on this. I've done rehabs but they've always turned to rentals, this is first house i flipped so im new at this selling thing. I listed my property on monday but nobody was allowed in til thursday. Well 2 people got in anyway. One party seemed very interested i personally met them and from there chatter with me they seemed basically sold. The other party had a realtor video the house to his client who is across the country and moving here in 45 days. Another party is pushing to get in tomorrow cause they want a chance before it goes away. So the guy across the country made the offer. Apparently hes had a few places slip out of his hands and now he placed a full price offer. However its a VA loan which requires 4% at closing apparently and he wants home warranty, few other things included in closing costs i would effectively pay.

So in the end its about a 5% reduction in asking price.  Neighborhood is real nice and inventory for type of home ive done is low.  If it were you, what would you do?

Sidenote: house is priced at a good sweet spot and the quality seperates it from the pack so i dont feel like its way underpriced based on comps etc.  I cant move on to next one til i get money from this one

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Residential Real Estate Broker · Portland, OR · Member since 2015 · 153 posts · 105 votes
11y

On the listing you can do a "all offers will be submitted to seller at *date"" - maybe a week after you put it on the market.  It gives everyone the chance to evaluate the property and submit their "highest and best" offer.  Or just tell everyone you'll respond back at a certain time and that there are multiple offers and they should submit their best?

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  • Residential Real Estate Broker · Portland, OR · Member since 2015 · 153 posts · 105 votes
    11y

    On the listing you can do a "all offers will be submitted to seller at *date"" - maybe a week after you put it on the market.  It gives everyone the chance to evaluate the property and submit their "highest and best" offer.  Or just tell everyone you'll respond back at a certain time and that there are multiple offers and they should submit their best?

  • Real Estate Investor · Longview, TX · Member since 2015 · 122 posts · 62 votes
    11y

    @Michell P. Agreed.

  • Dayton, OH · Member since 2014 · 52 posts · 5 votes
    11y

    makes sense i dont want to short myself but also dont want things to take longer

  • Rental Property Investor · Arlington, TX · Member since 2012 · 788 posts · 640 votes
    11y

    Have to agree with @Michell P. .  Put it on the market and you may have a bidding war.  Cash talks......I recently accepted an offer $5k less than highest offer because it was an all cash deal and didn't want to wait 45 days or have the buyer/home not qualify.

  • Realtor · Charlotte, NC · Member since 2014 · 935 posts · 467 votes
    11y

    @John T. sounds like a good problem to have. Let us know what you eventually accept and why. 

  • Real Estate Agent · Owasso, OK · Member since 2014 · 517 posts · 400 votes
    11y

    counter offer him with a 4% price hike to cover his 4% closing costs he wants you to help with and demand a higher than average earnest money and no or very limited contingencies.  Anything more than that and you are wasting your time.  He ties it up so you can't deal with anyone else, finds out he doesn't like this or that and uses his inspection contingency to get out, as is his right in the standard contract.

  • Real Estate Investor · Silicon Valley, CA · Member since 2012 · 169 posts · 52 votes
    11y

    Definitely agree with @Michell P. ! I made a clean and over asking price offer before the open house on my personal residence. Looking back, the previous owner might have done better to look at other offers. 

  • Investor · Webster, NY · Member since 2014 · 19 posts · 14 votes
    11y

    The VA loan will take longer to close (45 - 60 days) than conventional and can be a pain, they might also ask for a second appraisal paid for by the seller, try and hold out for a conventional offer at the same price, which can be closed as soon as 30 days. I agree with sending everyone a highest and best notification. Being patient will save you time in the end. I don't even consider FHA, VA or USDA offers at first. Mainly with FHA because of the 90 day rule, with VA it's just because they almost always go past their closing date and the worst thing is waiting for a closing when you need the money to move on.

  • Jerry W.Pro Member
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    Investor · Thermopolis, WY · Member since 2012 · 4k+ posts · 4k+ votes
    11y

    I would tell them you are obligated to go through with the open house.  You said no lookers before X date and its not fair to the ones who played by the rules.  Then disclose the current offer, make sure folks know you would prefer a cash offer and see what happens.  If your guy won't wait one week he wouldn't close anyway.

  • Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    11y

    I agree with Jerry, and the offer you got is a contingency contract, you need to tell others that you have a full price offer subject to financing.

    And, unless you did a great job on the rehab, don't hold your breath with any government loan, appraisers can get picky. 

    I won't mention that you may have "listed" too low (LOL) but I don't know your market.

    Congrats on a possible quick sale! :)

  • Dayton, OH · Member since 2014 · 52 posts · 5 votes
    11y

    so part of my concern is the guy needs to find a place in 45 days so im not sure if he wants to wait out weekend. Flip side property has alot of interest and maybe this just ist the buyer.   Part of me wants to counter with an increase above listing maybe making me responsible for 30% vs 100% of the costs and say take it or im going to ride out the weekend where i already have 6 showings scheduled and its only Wednesday and put pressure back on him.  I didnt realize the pitfalls of va loan but i would assume he would be highly motivated to make sure he has a place to go when he moves here from across the country.  Not sure how much of that he controls though

  • Dayton, OH · Member since 2014 · 52 posts · 5 votes
    11y

    one big concern i also have is going to much above asking and running into appraisal issues with lenders.  Im def towards the high end in terms of price per square foot.  Is this a valid concern?

  • Real Estate Agent · Owasso, OK · Member since 2014 · 517 posts · 400 votes
    11y

    It is a semi valid concern.  If you have a good agent, they should be willing to meet with the appraiser and show comps that would support the higher price.  The appraiser has to make his own decision but can be helped with better, relevant data.  It's part of the fiduciary responsibility that is due you in return for their commission.

  • Real Estate Investor · Clovis, CA · Member since 2014 · 195 posts · 194 votes
    11y

    You have too much interest to mess with a VA loan!! Hold out like Jerry says and see if you can get CASH. If not take as high of a solid offer as you can get and follow Chris's advise and have your agent provide some solid comps. (Keep the VA and FHA options in your back pocket for another flip you do, with less buyer interest, that you can't sell conventional or for cash).

  • Dayton, OH · Member since 2014 · 52 posts · 5 votes
    11y

    While I realize buyer doesn't have complete control, do they have any control to speed along the process of a VA loan? Aside from that is that really the only concern with VA loans? I've got more info that not only is the seller going to be moving here in 45 days, but his GF is pregnant and they are planning a wedding. So it's definitely in his best interest to make it happen by April 17th (proposed closing date)

  • Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    11y

    If you have that much interest before the opening date , raise the price , or hold the offers and tell the agents you want their highest and best offer .  

  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    11y

    If it's not on the market yet, you DO NOT have your best buyer yet, period.

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