Buy High? Sell Low? Oh! No!

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During the last 10 or so years, representing buyers hasn’t been easy in my home town of Washington, DC. Prices skyrocketed. There were nasty, bloody bidding wars with dozens of participants. It got so crazy that our local Association of Realtors even added a “Price Escalation Addendum” to our library of boilerplate forms. I can remember feeling elated whenever there were only three or four competitors at any given contract presentation instead of 30 or 40.

So, until recently, to buy a house or condo in our nation’s capital, you had to

* Be willing to give the sellers way more than their asking price;
* Pay hundreds of dollars for a home inspection before submitting your offer, or buy the place without the benefit of a home inspection (and a lot of these houses were really old);
* Give the sellers an earnest money deposit of at least 10 percent of the asking price;
* Forget about any contingency giving you any kind of out, like financing, appraisal, or lead paint assessments;
* Overlook stinky kitty litter, peeling plaster with layers of lead paint, kitchens with avocado green counter tops (no, not the granite type) and harvest gold appliances, and bathrooms that looked like athlete’s foot about to happen;
* Deal with it when you woke up in a cold sweat in the middle of the night shouting, “What were we THINKING?”
* Accept that getting out of the deal was impossible because you waived every contingency that might provide a safety net, unless you were willing to forfeit that huge earnest money deposit.

So that is what “Buy High” looks like. And as the winning agent more often than not, I occasionally felt a little queasy. What if they call me in a year or two saying, “Pat! I just got Dream Job in Paris! You gotta sell this place for me!”

Yikes!

Now it’s easier. You can include a home inspection, financing or appraisal contingency without raising eyebrows. You can sleep on it, at least for one night, without “You snooze, you loose” kicking in. We’re still seeing a few bidding skirmishes, but often none of the buyers come in at full price.

So where are you buyers? Are you masochists waiting for the market to take off again? Are you afraid that prices may go down a little more?

Good agents understand that our buyers are looking for their dream house, and, at the same time they are hoping to make a sound financial decision. Buying in a slower than white-hot market increases your chances of success on both counts.

So, what are you waiting for?

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