August, last year
We go to see a house with a pre-approval letter in hand. The house is exciting. It is old, needs work, has a dying apple tree in the backyard, stinks strongly of cigarette smoke from the previous owners' 63 years of smoking, and has a hole in the floor in the bathroom through which daylight is visible. Also, the flipper who currently owns the property put in new kitchen cabinets and covered up the gas line hook up for the stove. The house has no appliances.
The asking price is in our budget range.
We want to make an offer but do not (complications with agents).
January, this year
We finally convince our real estate agent to view the house with us. The real estate agent (hereafter, REA) looks at property with disdain. The house has been taken off the market and then re-listed, so it wouldn't look like the unwanted, rundown disappointment that it is. Also, the house has now been staged so it is much harder to notice the kitchen flaws and hole in the floor in the bathroom.
We say we want to make an offer.
REA says, eh, okay. It's a risk, and you'll want to get a lot of inspectors in here, but, eh. What number do you want to offer?
We say, Price - $24k.
REA says, okay. It's been on the market a long time. Seller might bite, just to stop losing money on the property.
The offer is made.
After 5 days of waiting, Seller responds.
We want more money, Seller says. Make a higher offer.
Seller has no other pending offers.
We think. We respond, same day, with an offer of Price - $9k.
We are angry that we have been asked to bid against ourselves.
REA says, good offer. It's in the middle of your opening bid and their asking. Good compromise.
We wait. We wait 5 more days.
While we are waiting, we go to an open house for a Different House. Different House is okay, not awesome, but okay. We are tired of waiting and decide to make an offer on Different House. REA says, Different House got more than 3 offers on the day of the open house. (It is now the day after the open house.) The seller is still accepting offers, but the highest bid is now $Price + $40k. REA asks what is our offer? We say, nope, not interested.
Same day, Seller of hole-in-the-floor comes back on our offer of Price - $9k.
I will lose money, Seller whines. I have another bidder, Seller claims. Their offer is much higher, Seller taunts. You should make a higher offer, Seller moans.
We think Seller is a liar. We think Seller is trying to squeeze more money out of us.
The market is going up, REA says. If you want the house, be aggressive, REA counsels.
We remember that the house has a hole-in-the-floor.
It is silly to lose a house over $9k, REA says.
We make another offer, hours later. The new offer is Price + $1k.
Next day, Seller responds: I took the other offer.
REA says: you lose, cheapskate. Market is going up, prices are going up. You must pay more money, you must go higher faster. Be ready to spend and spend big when the next one comes up.
What?? It's been eleven days. How can "the market" suddenly be selling at $50k over asking eleven days after absolutely nothing was being sold or even offered? How can "the market" be hot, hot, hot now when just five days ago we were the first people to even bid on the stinking house in five months? How can a house be worth more than asking price just because someone rented pretty furniture to make it look more appealing? When the pretty furniture doesn't even come with the house?
I haven't bought a house yet and, already, I want my money back.