multiple offers

This is a new series that will give more details regarding listings to help provide expectations for buyers and sellers regarding this new, more competitive real estate market in Metro Denver. 

The Details:

2 bedrooms
1 bathroom
Gorgeous Fir hardwood floors and plenty of charm!
1,000 sq. ft finished and an unfinished basement.
8,000 sq. ft yard.
A 10 minute walk to Downtown Littleton… Bacon, Fierce45, coffeeshops, The Viewhouse, and more!

The Price: $439,000

The Showings: Lasted Friday – Sunday. There were a total of 28 showings.

The Offers: 6 multiple offers ranging from $448k-476k.

The Decision: The top two offers (around 475k) looked very similar. Both had a quick close, great lender and an inspection for health and safety. However, buyer A was putting 10% and had a 25k appraisal gap and buyer B was putting 55% down and had a 15k appraisal gap. An appraisal gap is when buyers bring money above the appraised value should the appraisal come in lower than the price they are offering. With prices skyrocketing so quickly, this is a much needed detail in a contract.

The Verdict: The sellers liked Buyer B’s down payment. The sellers had previously had the appraisal waived for their initial purchase and refinance and were hopeful this would happen with Buyer B, removing the appraisal contingency completely (this means the lender did not require an appraisal since the loan was small due to a large down payment). There is no guarantee that this would happen, however, it will definitely not happen if a buyer has a smaller down payment with mortgage insurance. We ended up going back to Buyer B to see if they would increase their appraisal gap to 25k (in case there was an appraisal done). They agreed and we went under contract at 476k (37k over asking) with a 25-day closing.

The Process: The appraisal DID end up getting waived and the only contingency was the inspection which was for “health and safety”. The buyers did send an inspection objection asking for items that were not “health and safety” and they ended up withdrawing the inspection objection and continuing with the transaction.

As this case study shows, sellers can continue to expect a good number of buyers through their home over the weekend and buyers will have to compete for a home. To be competitive many buyers have a significant down payment and most contingencies are being waived.

Reach out to Liz for help with any real estate needs.

Liz is  broker and owner of Liz Daigle Realty.

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