Stories on Real Estate Bidding Wars
Jeff lost his first bidding war when he tried to buy a duplex off of H Street in Washington DC. There was a $50,000 escalation clause, to $370,000, someone had outbid him by $380,000 cash offer. With Reilly being 29, he planned to use the duplex as an investment and still rent near Alexandria, VA area.
Months later, he found himself getting engaged which changed everything. They decided to buy a home to live in, in which Reilly could renovate and fix things up. During that time, there was nothing but touring houses, bidding wars, and sellers who accepted no bid at all. They estimated that the bid on at least six homes that they were unable to close on. Their real estate agent stated that about 75 percent of the homes they bid on were going up against other buyers.
This is a problem that many buyers often face, this is because majority of people aim for little inventory, around the $350,000-$700,000 price range within the District and Takoma Park in Montgomery County.
Reilly had been to many showings, one of which was near the Rhode Island Avenue Metro, they called it “the chicken house,” because the neighbors had chickens in the back yard. The highest bid yet, $580,000 was offered, but even with that offer, Reilly was skeptical because he was unsure if they would pass inspection to qualify for a VA loan. It seemed as if they were settling for less, the couple wasn’t too fond of the chicken house.
During their search for a home, the newly married couple were renting month-to-month in Alexandria and actually decided to take a step back from looking around the D.C. housing market. His idea was to own property in a decent D.C. neighborhood, fix it up and make profit off of it.
After months of searching, Reilly finally bought a house on July 3rd. The price they were seeking was $545,000; they offered $535,000, and came to an agreement of $540,000.
Ann Wenzel and Scott Wallace:
This couple lost many bidding wars several months ago. Ann and Scott was renting a bungalow in Takoma Park for $2,200 a month until December 2016, they decided to starting looking at buying a home in the Metro-DC area for less than $500,000.
The couple found a decent home in Takoma Park, the sellers decreased their price about $10,000, which was in their budget, about a little less than $500,000. They offered the price that was asked, but wanted $5,000 back at closing. Unfortunately, they lost to a buyer that put 20 percent down. They only were able to put 10 percent on a down payment for the home.
Luckily, Ann and Scott won on their third bid, on a Brightwood rowhouse for $487,000 that they thought needed $50,000 worth of work to renovate and fix-up.
It can be overwhelming and tiresome to shop for homes on the market. For the most part, its very rare to lose on five or six bids, usually on the third try you’ll find the place for you.