When the pre-auction offer goes competitive....

Discussion in 'The Buying & Selling Process' started by GJD, 17th Apr, 2018.

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  1. GJD

    GJD Member

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    The scenario is that your pre-auction offer is accepted by the vendor, subject to the real estate agent inviting other open home visitors to make a competing bid. If no offers, then the house is yours. But what if there is a competing offer?

    I am being told by the real estate agent that if there is a competing offer, then I will be informed as such, and asked whether or not I want to increase my bid. I will not know if the competing bid is higher or lower than my accepted offer. Whilst I don't expect to know the exact value of the competing bid (especially if it is higher than mine), I am trying to avoid a scenario of increasing my bid when the competing offer was less than my accepted offer.

    How can I ensure that the relevant estate agent is not deceiving me. In other words, how do I know that the competing bid is real? How do I know that the real estate agent has not disclosed my bid to the competing interests?

    Any advice much appreciated. Thanks.
     
  2. The Y-man

    The Y-man Moderator Staff Member

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    In which state is the property?

    The Y-man
     
  3. GJD

    GJD Member

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    Victoria.
     
  4. The Y-man

    The Y-man Moderator Staff Member

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    The only "safe" way is to make your highest offer and then be prepared to walk.
    If they come back with a "higher offer from someone" then just politely say, "thanks, but I'm out".

    If it's a bluff the other offer will disappear.

    Is the offer at the standard REIV expiry on the contract?

    Also, how long before the auction?

    The Y-Man
     
  5. Propertunity

    Propertunity Well-Known Member

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    You cannot.

    You don't know. You may never know. The only way you'll find out is if another buyer trumps your bid and secures the property and you miss out. (Then you can be sure he did have another buyer.)

    There is no law preventing him from disclosing your bid. Some agents disclose, others do not. His sole purpose in life is to get the highest price on the best possible terms for the vendor.
     
    Finn Simpson likes this.
  6. GJD

    GJD Member

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    REIV contract. The deal was struck last night....24hrs to find a competing offer...three weeks before auction.
     
  7. The Y-man

    The Y-man Moderator Staff Member

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    Unconditional?

    The Y-man
     
  8. GJD

    GJD Member

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    Conditional on building inspection (my condition) and no other competing bids from Saturday's open house attendees (their condition).
     
  9. The Y-man

    The Y-man Moderator Staff Member

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    I think you are in a strong position as you have gone in early - I assume at the first open.
    Conditional is ok in this case, as it gives them time to proceed with the auction if your offer bombs (assuming the condition is your BP approval is within 2 weeks).

    I *doubt* another offer will come in at the next open - someone would have to be as committed as you AND they will think your offer is a dud imagined up by the agent.


    The Y-man
     
  10. GJD

    GJD Member

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    First and so far only open home was on Saturday. Next one is scheduled for Thursday, so obviously keen to have it done and dusted by then.

    But given the ethics of real estate agents I think they would be working the phones like mad and to extend the potential buyer pool beyond those that turned up on Saturday. Probably a few "private inspections" going on right now.
     
  11. justine77

    justine77 Well-Known Member

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    i once heard about conditional offers put in good enough to take it completely off the market away from competition and more open for inspections. but obviously they have stipulated that they want to keep showing it

    it also depends how much you want it

    a long time ago i knew i had a competing offer and i went quite a bit higher to secure it.

    a friend told me off why i didnt go up 1000 at a time

    i'm so glad i did and i've lived in that place happily for decades now. I wanted to secure it and i'm so glad i did. its gone up by alot.
     
  12. GJD

    GJD Member

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    They are wanting to "keep showing it"...just chasing up all potential buyers form the first weekend of open homes.
     
  13. Marg4000

    Marg4000 Well-Known Member

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    Then they are just doing their job. What is unethical about that?

    Their job is to get the highest price possible for the vendor. When you are selling, you will expect the same.
    Marg
     
  14. GJD

    GJD Member

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    Because the agreement was that they would only contact people who went through the open homes Saturday. If that is all that they do, then that's fair. If they contact a single person outside that group, I am calling that unethical.
     
  15. kaibo

    kaibo Well-Known Member

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    They should keep "showing it". If I was vendor until offer becomes unconditional I will keep doing open homes and even go to auction or if sell before auction then a few days prior as it is unconditional then.

    Unless your offer is way more than market price or there is no demand for it then it seems this agent is incompetent (may just want a quick easy commission) or the vendor is nervous/doesn't really care about getting best price
     
    The Y-man likes this.

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