By Lynda Cox
Let’s talk bidding wars (a.k.a. Multiple-offer situations)
So far this year Ottawa has seen almost 22% of its homes sell in multiple-offer situations. This is quite a change from last year’s 14%, and 8% in 2016. This indicates a seller’s market, that is low inventory with plenty of buyers willing to pay more. Inventory overall is 23% lower this year than last.
Has Lowertown had any bidding wars this year? Absolutely. There have been 7 bidding wars so far. That is about 12.5% of all sales and here they are:
- 235 Bolton asking $524K,
- 161 Bolton asking $499K,
- 262 Murray asking $485K,
- 263 Guigues asking $439K,
- 3 Rose asking $400K,
- 134 York #402 asking $345K,
- 179 George #1405 asking $279K.
All sold for more than their asking price.
This result is often achieved when the seller chooses a more aggressive price from the suggested range rather than a bullish or higher one. When a seller stays under a big threshold price which often goes in increments of $25K, and chooses $449K instead of $455K, or $499K instead of $520K then a larger buyer pool will be tapped into and BINGO! you create a perfect opportunity for multiple offers pushing your selling price up to where you wanted without the long wait, the possible price reductions, the often long negotiations and the stress.
This phenomenon also happens when inventory is low and buyers are plentiful, which is our present situation. Sometimes asking price is irrelevant in this type of market. There are so many buyers that at least one of them is prepared to go BIG.
What happens when a seller receives more than one offer? Offer content is only revealed to the seller and his/her realtor. Other interested realtors and their buyers are told only the number of offers submitted, but with no indication as to price offered or any other details. Once all the offers are in and all of the agents are informed of the number of competing offers, all buyers are given the chance to revise if they wish before their offer is presented to the seller. It truly is a “blind auction”. Many buyers attach personal letters and family pictures to try to gain more notice and favour with the seller. In the end, only one offer can be dealt with. Realtors know how to create this BUZZ; they delay offers, giving buyers time to get their ducks in a row (financing and building inspections done ahead of time) before the offer date. Buyers have a better chance of being successful if their offer has no conditions. We call that a cash offer. In the last article I mentioned that sellers should do a home inspection before going to market. This report is often relied upon if a buyer is competing.
As a realtor, I hate to see a SOLD sign go up the same day a property goes on MLS. To me, the property was not exposed to the wider market, so the opportunity for multiple offers was lost. Money might have been left on the table.
If you are planning to sell this year, be prepared! It could happen to you.
Lowertown statistics from March 8th to May 8th
Residential: 9 active Listings, 1 conditionally sold listing, 6 sold listings
Condominiums: 54 active, 8 conditionally sold, 11 sold
Condosales are still leading the market in Lowertown.
If you have any questions about real estate in Ottawa drop me a line at
Lynda Cox is a sales representative with Faulkner Real Estate