Getting the REA to increase the listing price

I'm sure I saw a thread about this somewhere previously, but I can't seem to find it now. Apologies if I'm doubling up here.

I recently made an offer on a place for 7.5% OVER the upper limit of the listed price. I am getting a B&P done, and if all is well, I am considering offering just over 10% above the listed price.

I'm pretty sure they will still say no, because they will probably get more at auction.

If they do say no, do they need to up the asking price online because it is over 10% of the advertised price? Who can I contact to make a complaint if they don't up the advertised price?

Thanks

 

@juzzy

why make an offer of 7.5% above market price, then do B&P then up it by 10%

just offer what you think is right price for property with subject to finance and satisfactory B & P.

 

I think he only wants to up it by 10% altogether not 17.5%. If your quite sure that offering 10% above asking price is still a bargain( need to be very sure on this) then its not that bad an offer imo, but as you said unlikely to be accepted and will go to auction.

 

@Leo2413

i get it but why back and forward.. hit'em with right price and terms or buy at auction!

sounds simple to me!

 

Maybe he's trying to avoid the auction and paying more than 10% on the price at auction, and offering now to pay 10% and save some. I just don't think it will work if the agent/vendors are smart they will go to auction. Unless they really think they wont get better at auction.

 

Did not know there were regulations around listing prices and offers received.... are there?

Pretty sure it would be in the agent's interest to leave the listing price "low" in order to attract more buyers

 

Yes, there are.

By way of example, if a property is advertised for auction say, at "price guide over $900K" and the REA receives a pre-auction unconditional offer from a purchaser of say $950K, which is rejected by the vendor, then the advertising needs to change to "price guide over $950K".

 

Learn something every day!!

Now that I think about it, I made a pre-auction offer above the listing price which was rejected, after that the listing price was changed to "contact agent"... although playing with the search parameters showed that the property was still showing up in searches at the old listing price.

 

Correct. I wouldn't be surprised if it goes 20% over the asking price (I'm not willing to pay that much).

This is what I am trying to achieve.

E.g. House is listed at 450-500k. I offer 555k. Now they have to up the price (do they?).

I'm hoping this will deter people from coming to the auction expecting to get a bargain. If the auction starts at a higher price, less people bid, and less people get sucked in to offering stupid amounts.

That's my theory anyway.

 

If you have received any written rejection of the offer and a copy of the advert notify OFT. They will do very little but you might get satisfaction.

 

You'd be better off, in my view, forgetting about how many people turn up to the auction, and focusing on your auction strategy. 2 x auctions we attended recently, were purchased by people walking in off the street that day, never having seen the property before.

If you offer $555K unconditional, and it is rejected by the vendor, and the agent keeps advertising in the low range, then just Open the bidding at $560K (if the property is worth it) and blow away all the people who think they can buy for $450-500K. It works!

 

Sound theory in my opinion although the effect will be quite marginal; bidders have a limit and if you start at what you think is a high price, but still under their limit, they won't be scared off just yet.

It will however stop people getting lower bids in and continuing past their own limits as they feel 'attached' to the property they felt they almost won

 

Yes, the strategy is designed to not get people emotionally involved and get "dragged up" in the heat of the auction to pay higher than you want to.

REAs have stats to prove that buyers will pay 20% over their budget if they can get them emotionally involved in the property.

 

What if they change their price to be Price guide over 560k cause of your offer and you have now attracted larger pockets to check out the property.

For example;

A property in my street a couple of years ago was quoted $360,000+ for auction and I thought it would go for about 430,000. 100+ people turned up and the open bid was $410,000, this killed a lot of people right off the bat and it sold for $465k.

If you put an offer of $396k (10% over original quote) you would of made it $400,000+ which might of attracted someone willing to go to $480,000 on the day.

Just leave it the way it is and just work on the auction.

Btw to change the price it needs to be unco and with the settlement the vendor wanted, otherwise they can say the offer was rejected due to the conditions or the settlement date and not change the price.

 

Hmmmmmm that's an interesting view. To be honest, I don't think people with deeper pockets would be interested in this place, but I could very well be wrong.

I planned on making it unconditional at their settlement terms.

The auction isn't until mid September, so I'm praying for an interest rate increase or something disastrous to happen to the economy to scare everyone off!

 

So if the REA changed the price to $555,000+ and you have said you think the property is worth more than that you don't think someone with 580,000 to $630,000 wouldn't come through and they may fall in love with it and now have beaten you.

Sure someone with a budget of $1,000,000 wouldn't look at it but someone on the tier just above yours might come through.

Remember they might think $555k+ for this I highly doubt it would get $650-700k but since it is so over quoted it might flop at auction and we might get it for $630,000.

Really just wait it out, tell the REA you are interested and wait. If they take offers before hand they have potentially disclosed that they do not have any/much interest and it is likely to fail at auction and you can then decide on your next move or you attend at auction and just smash the little people with your offer of $555k.

Either way you haven't disclosed your hand until the last possible moment. As the property has only just hit the market and being from Melbourne I am guessing you are looking in Melbourne which is a sellers market all you might do is put the vendors expectation on price further north.

There is a lot of interest in the mid 500s on the north side of Melbourne I am finding, you wouldn't happen to be looking there? Perhaps even Reservoir??

 

$500k was just an example, it's more than that unfortunately. A little further south than Reservoir. Although I am looking at Reservoir for IP2 (this one is probably going to be a PPOR, hence my eagerness).

I will just wait until the auction then. I actually won't be in Melbourne for the auction, which sucks. Will have to get someone to bid for me. I appreciate your advice!

 

All good it is just what I would do end of the day it is your life and your plan you need to work out.

If you feel it is best to put an offer in now and get them to change the asking price then go ahead, however I really couldn't be bothered going through all that effort to change the price. If you felt it was getting close to the price and wanted to buy before auction then I would be giving different opinion.

 

Buying before auction was obviously the initial goal, but the REA shut me down pretty quick and said they want to wait for auction to get the best price. Unless I offered stupid money, I doubt I would change their mind.

So I think I will take your advice and wait for the auction.

Cheers

 

@juzzy Auctions are not always a bad thing. Obviously in growing markets they usually aren't the best . But I have been to quite a few auctions where I expected the competition to be fierce and it was quite the opposite. When you are in an auction and you can sense the bidding is weak with not many serious buyers, ohhh boy....you can play hell with your bidding strategy and go on the attack. Those are some of my favourite buying situations.

Make sure you have your strategy ready before you go to the auction mate.