Like in a Dickens novel, this week ’twas the best of times and the worst of times. On the smiley face side of the coin, I wrote three offers this week. On the frowny face side of the coin, all three offers have ended up in multiple offer situations, with offers from other buyers for the same houses coming in as well. And this hasn’t been a particularly unique situation this summer. Of the nine offers I’ve written up since mid June, six have ended up in multi-bids. On a number of properties I’ve called to show, I’ve gotten the response from the listing agent that there are already offers on the table. I can’t recall hearing about as many multiple offer situations as this summer. What’s happening?
I think there are a number of factors at work. First, a number of really good listings have come to market in the moderate price ranges ($150K to $250K, and $250K to $350K) this summer. Some are entirely new listings, others are houses previously on the market at higher prices that didn’t sell, and came back this season with some nice price haircuts. There also seems to be a wider price spread this summer between Sullivan county and pricier counties further east, increasing the appeal of Sullivan for younger, first time second home buyers from the city. This summer I’m seeing a lot of interest among buyers on a budget who looked first in Ulster, eastern Delaware and Columbia who have turned their sights to Sullivan. Many of those buyers have more modest (and realistic) expectations in terms of house size, with smaller cottages and modest farmhouses hitting the sweet spot. Taken together, it’s resulting in this ‘perfect storm’, particularly in the $200,000 range plus or minus $25,000. That category is hot, with strong buyer demand and thankfully, some good inventory to meet it. But not enough inventory, and the result is bidding wars. Some buyers are also pushing up in price, and I’m starting to see multi-bids in the $300’s as well. (I’ve been involved in two.)
Listing agents have also played an important role in this. In 2014, there was an unfounded optimism that prices were going to climb sharply, and a lot of houses came to market priced well above what buyers were willing to pay. The result was a medicore year, with buyers not drinking the higher priced kool aid, and a lot of houses just not moving. 2015 has been a different story, with a lot of listing agents taking a more tough love approach, and only taking listings that are priced to sell. At the moderate price points, that strategy seems to be paying off. Houses are moving, and some are selling above asking price. In terms of units sold, it’s looking like 2015 may close out 15-20% above 2014.
It’s going to be interesting to see how the next few months play out. Personally, I wish I — and my clients — didn’t have to go through any more bidding wars. But I don’t think that’s in the cards for the next couple of months for charm and privacy seekers looking under $300K.