Do Some Buyers Go Too Far In a Bidding War?
The highest offer tends to win a bidding war, but frustrated buyers hoping to increase their odds have made Harry Potter videos and offered sellers Academy Award tickets.
NEW YORK – With strong buyer demand and too-few homes listed for sale, many buyers find themselves in bidding wars. To win, many try to find ways to entice sellers beyond price – and at times may take it too far, real estate professionals say.
Mary Lou Wertz of Maison Real Estate in Charleston, S.C., talked to The Wall Street Journal about one couple relocating from New York who fell in love with a $1.2 million, four-bedroom home while shopping online – but the seller had already accepted another offer. The New York couple then stepped up their game. They offered the seller $10,000 more than any other buyer offered, and they offered the successful buyer $25,000 to walk away. They even told the owner that they’d make a $30,000 donation for cancer research, since he recently lost his wife to cancer.
Ultimately, the New York couple’s offer wasn’t accepted. The sellers said it seemed “a little over the top.”
Another couple said they toured 50 Los Angeles homes, submitted 16 offers – sometimes above asking price – and were outbid every single time. But they then fell in love with a three-bedroom home listed for $735,000 in the Northridge area.
“We were turning up at showings, and there would be a line of people who were there before us,” Andrea Kissling of Los Angeles told the Journal. “These houses were getting 30 or 40 offers and going $100,000 over asking.”
The buyers noticed Harry Potter film memorabilia around the house, and to increase their chances for success, they produced a Harry Potter-themed video for the sellers (one of the buyers provides design services for Warner Bros.). The video fawned over the home and showed the couple reading Harry Potter books to their children. The couple also offered to buy the sellers VIP passes to The Wizarding World of Harry Potter at Universal Studios Hollywood.
Despite all the work, the couple still lost out to a higher offer for the home.
Chris Furstenberg of Nourmand & Associates in Los Angeles says one of his clients – a filmmaker – once made an offer that came with the promise of tickets to the Academy Awards. But even here, the seller went with a higher offer.
Furstenberg says such enticements often only work to settle a tie in a bidding war. But if there’s a higher price, that usually always wins out in the end – no matter how much buyers try to sweeten the deal with other offerings.
Source: “From Oscars Tickets to Harry Potter-Themed Videos, Homebuyers Are Spicing Up Their Offers,” The Wall Street Journal (Jan. 14, 2021)
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