Emotional Buyer

So this buyer offered 23% over asking price and got the winning bid.

The rest of the bids were around 1~4% over asking.

I would think that the LA wouldn’t tell the winner how much he overpaid, but the rest of the bidders know how far off they were compared to the winning bid.

I think it’s either an emotional buyer or he/she got ****ed by their BA.

So what’s the dynamic here? If I were winning could I ask how much the 2nd bidder offered? Technically the buyer still hasn’t handed over the deposit check upon knowing that he won.

During 2012, there was a home listed at 699k (10k lot, 3BD, 2BH), we bid 780k(2nd), but the winner is 836k (almost 20%). The winner was right on comps as I have never seen any homes selling less than 850k thereafter.

Normally, such 20%+ offers are possible with low list price, kind of low ball list prices. In such case, list price does not matter, but actual Comparative analysis matter. This is very common in Cupertino Homes, the agents provide a low list price to bring competition.

Can you provide the home here so that we can analyze whether it is worth that much?


There are too many ifs.

Buyer wants the house, willing to pay $x (thinking that is the market value), and got offer accepted, then proceed. There is always going to be some hesitation or cold feet. If this is desired neighborhood (PA, LA, MV, CU), buying is better than not buying.

So what if 2nd bid came in 20% lower. The buyer can always refuse to sell. So in your hypothetical case, top bid is not 20% higher, but same level as 2nd offer… If seller thinks that is below market, buyer will just wait another week or 2, trying to get higher offer.

By the way LA will not disclose the competing offers, as they don’t want buyers to back out.

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I believe these situations are more often than we thought, the winner is at least 10% higher than the second bid. I further believe they are mostly China Chinese buying site unseen and employees from FB and Google. No supporting data or study, just my beliefs.

I did not believe this initially. Many times I noticed, From the buyer’s name from county records, I see this is valid guess. They are from China or HK or related areas.

I think it’s not appropriate to disclose the address since this is still in contingent?

But you guys’ analysis are correct. If the first bid is only 5% over asking maybe the seller wouldn’t even sell.

The house is listed slightly lower than market. 23% over asking brings it up to #5 most expensive $/square foot (out of 30) sold over the last 3 months.

Maybe that’s the right move for the buyer to get the house.

It’s not one of those area mentioned above, hard to believe it’s oversea buyer buying unseen.

I assume when you mean foreign buyers, you mean folks who do not live here locally. There are a lot of US residents in Bay Area with Indian and Chinese origin. So if you only look at the name on record, I don’t think you can tell if they are foreign versus US resident.

From our limited data 4 years ago when we were in the market in PA, in just over 10 transactions, we saw around 1/4 were all cash offers. I think this is aligned with data that said around 30% are cash offers.

But surprisingly, we didn’t face any foreign buyers. In fact, in over 10 transactions, none of the buyers in final running were foreign buyers. It is possible we just don’t know who are foreign buyer. Win or lose, my realtor always tried to find out who are other buyers and by approximately how much. He doesn’t know for sure, but he tries to get info and guess. It’s also possible foreign buyers’ offer were not in the final running; maybe their offers are lower. Or maybe they didn’t go for the same house that we did; maybe they were buying better and more turnkey homes.

Around our neighborhood, we do see a few homes that were sold but were not occupied. I assume these are foreign buyers. But I estimate it is not even 1/10. And several of these homes are brand new constructions (tear down old 900-1200 sq ft house and rebuild 2200-3500 sq ft).

One surprising thing we saw is # of high downpayment. Over 1/2 of transaction had more than 50% downpayment. Some were like 80-90% down. I guess they want to show that getting loan is no risk in these cases, though the closing date is still 25-30 days, longer than all cash.

Willing buyer. Willing seller. That’s the way it goes.

Unless the Elizabeth Warrens of the world have their way!

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Just take this example here

The home was bought by Asians, especially Chinese origin. Google them with various options, you may have google keyword search. Any Tech or local residents I can get it with first hit either facebook or linkedln etc.

You will never be able to find them in google. Mostly, they are unknown records, some relatives of bay area or non-resident of USA.

Even though this is not 100% correct, but more than 75% accuracy is there. Try with your known pals, you will get better results.

Naive question - how do you find seller and buyer names for sales from county records ?

All I could find from sccccessor.org site is property records for a given SC property. That does not seem to have any sales info.

You might be wrong on this one. The owner is a high tech worker with a Cupertino company.

Yes… Please don’t for the sake of the transaction.

Yes, you may be right, one hit from Apple. If this is right person, Amazed that he offered this much cash offer within 2 years of Apple job after his graduation from college ! That is the main reason I discounted not possible.

Potential chance that parents, may be wealthy, would have cash to provide him too.

Answering my own question - www.clerkrecordersearch.org has all documents searchable for APN of a house to find sale transactions with seller and buyer names. Pretty useful transaction logs to find distributions of incoming demography in certain pockets you may be targeting for a primary house.

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I’ve purchased homes at market value, below market value and above market value. There is no telling why people do what they do.

We overpaid in 2009 because we relocated and needed a home to live in as we couldn’t find a reasonable rental within a school boundary area. After three months of making offers and watching the clock tick down to the start of school we overbid significantly to get the house in the first choice location. It worked out very well. We were told we were stupid to do that in a down market and for other reasons. Certainly everyone had an opinion against what we did. The price we offered was in the middle of our price range. Affordable, the right location and when the time came we would be able to rent the place for at least 40% more than the mortgage. And the market went up.

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Completely agreed with the points raised in this thread.
It’s not like we’re buying commodity goods. Each property is unique (time, location, condition)

Anyway, just to close the loop, you guys are right, it looks like 99% oversea chinese buyer.
LLC registered in June 2016 by a chinese agent.

Buyer paid 422,000 over asking. 200,000 over redfin’s current estimate.
So the house is indeed listed quite a bit below market to attract bids.
But like ptiemann’s recent post, that strategy might not always work, since the rest of the bid is only 3-4% over asking, but this time the seller did very well

In the end it doesn’t matter, maybe the buyer just want to move their money oversea, buyer’s happy, seller’s happy.


Did anybody mention Apple?
I heard something in the news, 25% sales decline? :blush:

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They had earning call today, and stock was up almost 7% after hour for beating the expectation. Haven’t looked into the numbers yet though. Maybe it was low expectations to begin with.

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I don’t own long/short appl. But from what i see, apple is stall and slowly dying IF they don’t have any breakthrough in the next few years. I don’t really know if they reporting the truth , but the demand in china is really declining. Even without the south china sea crap. People in china no longer WANT it since it’s so easy to get , it doesn’t have the wow factor anymore. I think biggest mistake tim cook made is open up the stores in china. He doesn’t know chinese, the easier , cheaper and custom to their taste it gets, they think it’s trash. If it’s hard to get and expensive and you don’t give a damn kneeling down to them, they’ll do whatever it takes to get it. It’s just the way it is. My inlaw used to be a apple fan, think apple is the best, now he think it’s a piece of shxx. He rather get a LG than another iphone.