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Thursday, March 5, 2015

Buyer Demand Keeps Outpacing the Supply of Homes for Sale

[Published March 5, 2015, in the Jeffco editions of the Denver Post's YourHub section]

This Tuesday I had yet another closing were the sale price far exceeded the listing price. In this case I had listed the home for $495,000 and it went under contract immediately (because we had multiple offers) for $525,000. 

Also this week, it took a buyer of mine offering $221,000 to be the top bidder on a Lakewood home listed at $185,000. Our showing was during an open house and there was hardly room on the street for all the agents and buyers to park!  Ours was the ninth offer submitted on this unimproved home.

One of the homes this same buyer lost out on was next to a railroad crossing, and, as luck would have it, a train came by during our showing. The ringing of the crossing signals and the blasting of the train horn was loud even inside the home which was only 20 yards from the tracks. We visited the first day it was on the market, and there were already six offers, all above list price, according to the listing agent.

Homes like that which might never sell in a “normal” market are selling in just a few days in this current market, which started in January 2013.  If you have what would normally be a hard-to-sell home, you probably bought it at quite a discount prior to 2013.  In that case you should consider putting it on the market now and you’ll realize a much greater gain, percentage-wise, than homes which were not hard to sell back then.  If you wait until next year you’re likely to find that once again your house will be hard to sell and may sell at a discount rather than a premium.
The reluctance of people to sell their home is quite understandable — they know that it could be hard to find and buy their next home. My advice is to price your home correctly so as to get multiple offers. With multiple offers, you’d be amazed at the concessions you can extract from the winning buyer. Not only can you choose the buyer with the best financing (or cash), but you can get them to agree, for example, not to make the wood shake roof an inspection issue, and, importantly, to be flexible on closing date so that you can buy your replacement home.  Those aren’t hypothetical examples. I have achieved those two specific concessions recently for my sellers.


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