Bidding against myself?

Zipppy

Sorry to resurrect an old thread but....

We've bid on a property last week ..

There was an offer of 260 which was rejected...I bid 270

Bid of 271 apparently came in..we went 272500....

New bid this morning of 273 (a 500 euro increase)

I asked EA was this unusual and he said it was..

WTF is going on..am I bidding against myself?
I mean surely bids of 1k and 500euro are very unusual???

Thoughts?

Man007

Zipppy wrote: »

Sorry to resurrect an old thread but....

We've bid on a property last week ..

There was an offer of 260 which was rejected...I bid 270

Bid of 271 apparently came in..we went 272500....

New bid this morning of 273 (a 500 euro increase)

I asked EA was this unusual and he said it was..

WTF is going on..am I bidding against myself?
I mean surely bids of 1k and 500euro are very unusual???


Thoughts?

That seems strange to me i would have thought €2.5-€5k was the norm.

It could mean the other bidder is reaching their limit and you're close to getting it.

I would be inclined to think its legit why would they be bothered making up increased bids so small.

You do always wonder if the Estate Agent is being straight up only way to find out is call their bluff the downside to this is you may lost the house you want if it is legit

P. Breathnach

Man007 wrote: »

That seems strange to me i would have thought €2.5-€5k was the norm.

It could mean the other bidder is reaching their limit and you're close to getting it.

I would be inclined to think its legit why would they be bothered making up increased bids so small.

You do always wonder if the Estate Agent is being straight up only way to find out is call their bluff the downside to this is you may lost the house you want if it is legit

A few years ago, when conditions were different, the standard response to a situation like this would have been to jump your offer a good bit to show the opposition that you meant business and, hopefully, to see them off.

While I am sure that EAs are inventing bids on property, I am inclined to take the same view as Man007: this pattern is so unusual that I suspect that an EA is unlikely to invent it. Either that, or it is an exceptionally astute EA.

If it is legit, the next move should be a bid of €280k from you - if you can manage it, and if you consider the house is worth that much to you.

Zamboni

Reduce bid to €265k and/or walk away.

killers1

There's a lot of suspicion around in relation to EA's creating 'bids' to push the price up on properties. Whilst I'm not saying that this doesn't happen I can only give my experiences on the subject. Over the past couple of years where purchasers were few and far between any of my clients who were 'outbid' on a property where the EA said a higher bid came in and my client subsequently walked away from the property not once did they get a call back from the EA to say the higher bidder had fallen through...EA's are just trying to make a living and in this market I would be inclined to think that there is no advantage to them creating imaginary bids as the difference in commission to them between a few €'000 on the purchase price is negligible. At the end of the day they just want a sale to go through and why risk losing a genuine bidder by creating a fake one? I'm not saying trust everything the EA says, I'm only saying that if they tell you there is a higher bid or an offer in already on a property the chances are they're probably telling the truth...

earlyevening

Maybe its the second bidder who is astute.

Maybe he figures you will think the EA is messing about and that you'll walk away. Why bother increasing by 5000 when 500 is enough to put doubt in your mind and make you look elsewhere?

Mind games between the lot of you!

GetWithIt

P. Breathnach wrote: »

A few years ago, when conditions were different, the standard response to a situation like this would have been to jump your offer a good bit to show the opposition that you meant business and, hopefully, to see them off.

I never got this mentality. Whether you bid in hundreds or thousands makes no difference. The highest bidder will get the sale.

Scaring off the opposition by overbidding seems mindless.

It's not a game of poker where you need to overbid because all you have is a pair of threes. It's real money you end up paying, the same real money as anyone else. There is no opposition. There is only the market.

I would have no problem in bidding in hundreds. If the next lowest is X why would you want to pay X + 5000 when you could pay X + 500?

killers1

GetWithIt wrote: »

I never got this mentality. Whether you bid in hundreds or thousands makes no difference. The highest bidder will get the sale.

Scaring off the opposition by overbidding seems mindless.

It's not a game of poker where you need to overbid because all you have is a pair of threes. It's real money you end up paying, the same real money as anyone else. There is no opposition. There is only the market.

I would have no problem in bidding in hundreds. If the next lowest is X why would you want to pay X + 5000 when you could pay X + 500?

I agree with this... there has always been 2 schools of thought when it comes to bidding. Firstly you hope the other bidder is at or close to their maximum so the bids increase by small amounts hoping the other party will pull out. The problem with this method is that the other bidder might think 'what's another €500 or €1k, we'll increase our bid again....' or the second school of though was 'we'll increase our bid by €5k-€10k and hopefully blow the competition out of the water...' The second method can be the more riskier strategy as before you know it the price has gone up by €20k... The bottom line is you've no idea who/what you're up against, there's no foolproof way of ensuring you get the property, the highest price generally wins... I would say though that EA's do develop a relationship with bidders and to have them on your side is a help....

Man007

Zamboni wrote: »

Reduce bid to €265k and/or walk away.

I don't get this mentality a lot of people have ie if someone else offers walk away don't get into bidding in this market.

If you did that everytime how long would it take to get a house its not as easy as that if someone likes a house and they think it is still good value why risk losing it for the sake of bidding €5k

Killers1 wrote: »

or the second school of though was 'we'll increase our bid by €5k-€10k and hopefully blow the competition out of the water.

We bid on a house and the next bid that came back was €15k higher

P. Breathnach

GetWithIt wrote: »

... It's not a game of poker ...

It's remarkably like high-stakes poker.

killers1

Man007 wrote: »

We bid on a house and the next bid that came back was €15k higher

I'm not surprised by that... Did it 'blow you out of the water' or did you increase your bid??

ted1

when I was bidding I was increasing by 1k each time.

a couple of reasons

I wanted the sellers to think i was near my limit and scrounging around to get the extra.

I didn't see any reason to go up higher, why go 5k more then the next highest bidder.


I also acted nervously , so as to give the estate agen the impression I couldn't go higher.

I got a house for a good price. ona pervious house ai was outbid by someone who went up 15k, i was willign to go an extra 2k, she paid 13k more than she had to.

Zamboni

Man007 wrote: »

I don't get this mentality a lot of people have ie if someone else offers walk away don't get into bidding in this market.

If you did that everytime how long would it take to get a house its not as easy as that if someone likes a house and they think it is still good value why risk losing it for the sake of bidding €5k

Well if you have 5k + interest to throw around like knock yourself out.
It's four walls made of bricks and there is no shortage of them
Work out your max for a property and if the price goes above that regardless of whether if fact or fiction walk away.

kippy

P. Breathnach wrote: »

It's remarkably like high-stakes poker.

It's not at all like poker.

OP,
I'd hate to be in your position. Can you afford to make another bid, can you afford to repay the mortgage and is the house a long term buy?
These would be key indicators for me.

P. Breathnach

kippy wrote: »

It's not at all like poker....

There are people declaring positions involving big money; in such scenarios, some people might be bluffing, and others are not; it's difficult to judge who is a bluffer, but it is to your advantage if you can figure that out (or make a good guess). For me, that's sufficient basis for the poker simile.

The challenge Zippy faces is to figure out if the competing bids are real or bluff, and what bidding strategy is most likely to succeed in the situation.

As I said before, the unusually small increments make me lean towards believing that the bids are genuine - but (obviously) I don't know.

I described one form of response: raise the level and try to blow the opposition out of the game. Other responses are possible. But we can't see everybody's cards, so it's impossible to say what the perfect strategy is in this particular case.

riclad

bid what you think its worth,price that will not put you under pressure .If ITS
a fair offer ,,and you are the top bidder it,ll be accepted.
ITS waste of time bidding in 1k increments.What are under similar houses going for, in the area.bid in 5k ,increments,or walk away.

Some people will pay an extra 30k, cos its in a quite cul de sac, full of older people,no kids,no traffic ,away from the motor way, corner site,
so its up to you,will you be happy to pay a bit extra.
i might pay an extra 15k above average price ,, to secure a nice house in area x.
Depends on your income ,etc
MOST areas loads of house s for sale.UNLESS you need a 4bed house
with a large garden, then your choice of houses for sale will be smaller.
use daft.ie to check average price in that area,estate.

ted1

riclad wrote: »

bid what you think its worth,price that will not put you under pressure .If ITS
a fair offer ,,and you are the top bidder it,ll be accepted.
ITS waste of time bidding in 1k increments.What are under similar houses going for, in the area.bid in 5k ,increments,or walk away.

Some people will pay an extra 30k, cos its in a quite cul de sac, full of older people,no kids,no traffic ,away from the motor way, corner site,
so its up to you,will you be happy to pay a bit extra.
i might pay an extra 15k above average price ,, to secure a nice house in area x.
Depends on your income ,etc
MOST areas loads of house s for sale.UNLESS you need a 4bed house
with a large garden, then your choice of houses for sale will be smaller.
use daft.ie to check average price in that area,estate.

Daft doesn't give the average price in an area. They only give the asking price. I can tell you that in killiney where I've been watching the asking price has no bearing on the final sale price.

Never bid what you think its worth, always bid below. Cash may be worth mire to the seller.

riclad

Most people put asking price 20 to 30 per cent above what they think house is worth,i dont think you can judge the market by killiney ,thats a small
ultra posh area.
if i,m looking to buy a ford focus,or toyota corolla
i dont waste time going to a bmw or mercedes dealer.
not much chance of getting a new bmw for 15k.
A good agent will not price a house too high as that will discourage any bidders.
3bed houses in the same estate tend to be in a similar price band,give or take 50k.
if theres 3 people interested in buying house x , the price will go to the highest bidder ,im presuming theres no phantom bidder.
IT might go to a lower bidder whos paying cash,no bank loan needed.
if you think house is worth 200k,you are not gonna advertise it for 300k.
AS above ,cash may be worth more to a seller, he might accept x amount
cash ,even if theres a higher offer from a person using a bank loan / mortgage.

Maybe you like estate x, theres 4 3bed houses for sale,
this has a garage ,or new kitchen , larger garden, etc so you are ready to bid a bit
extra ,its a bit niccer,bigger than the other houses you, have viewed.

my friend looked at ten houses, he bid on house x,
mainly cos it has a 40ft garage, his first bid was accepted.
otherwise it was just a standard ten year old house.
the other houses had no garage.
What are other similar house s in the area going for.

machiavellianme

See where the pattern ends. Add another 50.00!

kippy

P. Breathnach wrote: »

There are people declaring positions involving big money; in such scenarios, some people might be bluffing, and others are not; it's difficult to judge who is a bluffer, but it is to your advantage if you can figure that out (or make a good guess). For me, that's sufficient basis for the poker simile.

The challenge Zippy faces is to figure out if the competing bids are real or bluff, and what bidding strategy is most likely to succeed in the situation.

As I said before, the unusually small increments make me lean towards believing that the bids are genuine - but (obviously) I don't know.

I described one form of response: raise the level and try to blow the opposition out of the game. Other responses are possible. But we can't see everybody's cards, so it's impossible to say what the perfect strategy is in this particular case.

In poker, you can see everyone playing the game (online or in real life), everyones cards are on the table, and the dealer has no tangible advantage over anyone else.
Poker is a far easier "gamble" as there are actually fewer unknowns and no such thing as "market" forces.

killers1

riclad wrote: »

IT might go to a lower bidder whos paying cash,no bank loan needed.
AS above ,cash may be worth more to a seller, he might accept x amount
cash ,even if theres a higher offer from a person using a bank loan / mortgage./QUOTE]

When both solicitors finalise the paperwork and close the purchase, the seller always gets 'cash' irrespective of whether it arrived in a suitcase or as cleared bank funds....i.e. a cashed mortgage cheque..

ShadowHearth

OP, it's very weird pattern. I had to bid by 1k. I sow couple we were bidding against myself as we viewed house at same time after work. Estate agent himself did not wanted stupid bids too.

OP, start bidding by 100eu. If estate is ****ing around, he might get tired of this crap too.

killers1

Another thing that can happen when the bids are increasing in very small increments and dragging on and on the EA may ask each of the bidders to offer their best & final bids and the highest bidder wins.

Man007

killers1 wrote: »

I'm not surprised by that... Did it 'blow you out of the water' or did you increase your bid??

No the misses persuaded me to bid higher we started low so was still under asking and what we considered it was worth

Man007

Zamboni wrote: »

Well if you have 5k + interest to throw around like knock yourself out.
It's four walls made of bricks and there is no shortage of them
Work out your max for a property and if the price goes above that regardless of whether if fact or fiction walk away.

What if the house was asking €320 by bidding another €5k he is still under asking and you say walk away just cause someone else has bid how is this throwing money away.

It's 4 walls maybe if you're an investor but not if it's a family home there has been numerous threads recently about shortage of proper family homes in good areas so why not bid within you're limits if you have to in order to get it.

Webster29

OP, is this property in Phibsborough? I saw a house in Phibsborough on Friday and the Estate Agent told me that this had been the pattern of bidding on the house.

If so, and having seen the house I personally think the reason that bids are going up in such small amounts is that it has reached the top end of what it is worth in present condition, ie, by the time you do the required renovation work, the house will be worth the same or less than you've spent on it. That said, it's a lovely house and if you're planning on staying long term that may not be a concern for you.

If not the same house, I think the likelihood of the same pattern arising on two separate houses in the same week is extremely unlikely and on that basis I would assume the EA is lying.

riclad

is this a house that needs repairs, modernisation ,older house?OR
just a standard 3bed house.

Zipppy

Webster29 wrote: »

OP, is this property in Phibsborough? I saw a house in Phibsborough on Friday and the Estate Agent told me that this had been the pattern of bidding on the house.

If so, and having seen the house I personally think the reason that bids are going up in such small amounts is that it has reached the top end of what it is worth in present condition, ie, by the time you do the required renovation work, the house will be worth the same or less than you've spent on it. That said, it's a lovely house and if you're planning on staying long term that may not be a concern for you.

If not the same house, I think the likelihood of the same pattern arising on two separate houses in the same week is extremely unlikely and on that basis I would assume the EA is lying.

Yep in Phibsboro...and I do think its kinda reached limit of what it should be at this stage...

Latest is...500 bid by party x was increased by 4500 by another bidder party Y..
Party X came back with another 1k
Ive just gone 1.5k

All weird but we'll see what happens..

Does look like a genuine bidder though cos of new bidder (Y) into the process...

kippy

Zipppy wrote: »

Yep in Phibsboro...and I do think its kinda reached limit of what it should be at this stage...

Latest is...500 bid by party x was increased by 4500 by another bidder party Y..
Party X came back with another 1k
Ive just gone 1.5k

All weird but we'll see what happens..

Does look like a genuine bidder though cos of new bidder (Y) into the process...

At this point I'd be talking Craig Davids advice.
Walking Away.

Gurgle

There was an offer of 260 which was rejected...I bid 270
Bid of 271 apparently came in..we went 272500....
New bid this morning of 273 (a 500 euro increase)
Latest is...500 bid by party x was increased by 4500 by another bidder party Y..
Party X came back with another 1k
Ive just gone 1.5k

So you've crossed €280k on an initial bid of €270k, I suspect you've found a real pro estate agent and he had you figured out on the first meeting.

He's still stringing you along, trying to get that big jump to 'secure' the house.
What EA would even entertain bids incrementing by less than 0.2%?

Zipppy

Gurgle wrote: »

So you've crossed €280k on an initial bid of €270k, I suspect you've found a real pro estate agent and he had you figured out on the first meeting.

He's still stringing you along, trying to get that big jump to 'secure' the house.
What EA would even entertain bids incrementing by less than 0.2%?

Do you think he's bluffing and that there is no one else??

Gurgle

Zipppy wrote: »

Do you think he's bluffing and that there is no one else??

Bearing in mind that this is the skeptical opinion of someone who won't be affected either way, yes.

Its up to you to decide what its worth to you, and you either get it without exceeding that price or you don't.

PCPhoto

Zipppy wrote: »

Do you think he's bluffing and that there is no one else??

Walk away from the estate agent and buy somewhere else

from what you have told us - I would suggest that there is no-one else and the EA is trying to gazzump the price by creating a price war....even if there are other bidders - do you want to get involved in a bidding war ???

Walk away now - prices will still be this low and even lower in the near future....no shortage of homes but there is a shortage of buyers.

Webster29

Assuming it's the house I saw, I believe it's real. I was at the open viewing, there were a huge number of people there. I made an appointment to go back on a weekday and three other couples showed up with me. Have been looking myself for over six months and this is by far the nicest house I've seen. There is no shortage of rubbish overpriced houses in poor condition in the middle of nowhere, but there is certainly a shortage of houses on nice streets in good condition at reasonable prices. I would be bidding against you too Zipppy only I am avoiding all bidding war situations.

Balmed Out

Webster29 wrote: »

Assuming it's the house I saw, I believe it's real. I was at the open viewing, there were a huge number of people there. I made an appointment to go back on a weekday and three other couples showed up with me. Have been looking myself for over six months and this is by far the nicest house I've seen. There is no shortage of rubbish overpriced houses in poor condition in the middle of nowhere, but there is certainly a shortage of houses on nice streets in good condition at reasonable prices. I would be bidding against you too Zipppy only I am avoiding all bidding war situations.

Chances are Webster is legit but he does only have two posts and one couldnt be shocked if he was your estate agent:)

Not buying in Dublin so I cant comment on the market there but when I feel that prices are right and enter the market I will do as Webster and try not to get into a bidding war.

Zipppy

Webster29 wrote: »

. I would be bidding against you too Zipppy only I am avoiding all bidding war situations.

Think I'll join you

Webster29

I'm definitely not anyone's estate agent! Just a prospective buyer getting more and more frustrated with this "buyer's market". In my limited experience, lack of supply is a real issue pushing up the prices of halfway decent houses. And many not halfway decent houses.

Linoge

If its going up by little increments like that, use your other leverage. Are you a couple with mortgage approval? Are you a cash buyer (no house to sell)? Are you local who wants to buy in the area? Throwing your weight behind how sure the sale will go through with you is worth a few grand to the seller on its own.