How many offers will there be on that Silicon Valley home?

Graphic of person with computer and cell phone and words "How many offers are expected for that listed home?"The deep sellers’ market continues to frustrate Silicon Valley home buyers.  With scant inventory and sales, sometimes there’s very little to pick from, and many, many buyers all vying for the same property. A common question from Realtors and buyers alike to listing agents is this: “how many offers are you expecting?”

In short:

  • when showings change from 30 minute windows to 15 or 20 minute viewing times, you know that there’s a lot of interest
  • online, look to see if Redfin calls it a “hot home” – those are more likely to attract multiple offers (also, watch the Redfin price estimate, it changes with its website traffic)
  • the ratio of disclosure packages out to offers written is about 1 in 3 for most homes (a near perfect house will have a higher ratio – perhaps 50% or a little more, a home with issues will have a lower ratio)
  • it’s not an exact science – some buyers will drop out even after writing an offer, and some buyers will swoop in at the last minute
  • the overbids are often proportional to the number of contracts received, but not always (an old rule of thumb is 1% per offer)
  • listing agents may play down the number of offers expected since they don’t want to discourage anyone from writing

It can be hard to know.  While some real estate agents advise their sellers to market the home with an unrealistically low price in an effort to obtain an avalanche of bids, most do not, but instead caution that it’s better to list on the lower end of the probable buyer’s value than the high end. If it’s a little low, the market will correct it (at least in a sellers’ market) but if it’s too high you may see no contracts on it at all.

How many offers? Communication is key

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