Bidding war sends home prices up

7:17 PM, Mar 27, 2013   |    comments
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MARIETTA, Ga. -- After being outbid on one offer, and seeing several others fall through, Bob Freeman could sense his client's frustration. So he started asking around, for potential sellers - someone not yet on the market.

"I was able to get my buyers into the house before anybody knew about it and we wrote an offer and got it accepted in a couple of days," Freeman said.

It's simple. Demand is up, while the number of houses on the market has dropped. I mean, really dropped. Right now there are 35,000 houses for sale in metro Atlanta. Compare that to this time in 2007, when there were 98,000 homes. First time home buyer Leah Jacobs had no idea what she was getting into.

"I thought it was more a buyers market, that I was going to go out, get a house, close on it and be done. But it didn't happen that way," Jacobs said.

Four months later, she has looked at nearly 50 homes, and has yet to close on one.
Leah said, she has submitted over 30 offers and been outbid on every one of them because of the competition and limited funds. She has enough for the down payment and closing costs but folks are bidding so much more than the ask price.

In some cases buyers are writing personal letters to appeal to sellers to accept their bid, or letting money talk, with an escalation clause in their offer.

"Whatever the highest offer you have is, we will trump that deal by another 2,500 dollars, another 5,000 because we want this house and we want it now."

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