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Short Sales & Foreclosures = More Multiple Offers

Sounds kinda funny but many of the foreclosures & short sales I’ve been showing lately are receiving multiple offers… and are doing so at a much higher rate than the rest of the listings on the market!  In some cases the homes sell for at or above asking price, though most still sell for less than asking.

What is the reasoning for this?  Well, it actually is a combination of several factors:

  1. Many buyers feel that foreclosures and short sales are the “best deals” in the market and therefore they can draw more interest.
  2. Buyers feel that they can lowball foreclosures and short sales more than other properties because of the condition and/or distressed nature of the situation.
  3. Bank owned and short sale properties subject to bank approval are typically much slower to respond to offers (as little as 2 days for bank owned & as much as 2 months for short sales) and so there’s more time for more interested parties to come forward.

Moral of the story: if you’re shopping for a foreclosure or short sale, expect to find some homes sold out from underneath you and others to have multiple competing bids when you submit yours.

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TwinCitiesRealEstateBlog.com is not a Multiple Listing Service MLS, nor does it offer MLS access.
This website is a service of Aaron Dickinson of Edina Realty, a broker Participant of the Regional Multiple Listing Service of Minnesota, Inc.