Should you Make an Offer even if you're not ready to buy?

Question

I saw a town house on redfin for $129K but the property history is strange.

It was sold in 1972 for $18,095.

Then it was sold in 1974 for $18133.

It was listed for sale for $126.9K just last month.

It sold on May 12th but the price isn't shown.

It was relisted on May 17th for $129.9K.

What's going on with this property?

I figured since its bouncing all over the place, I can put an offer in at $100K and see what happens.

Problem is, my refinance isn't complete yet, so I won't have access to the capital I need for the down payment for a month or two.

Should a make an offer now?

Or is the buying and selling history of this property a bad sign?

Charlie MacPherson · Answer

@Ibrahim Yamini  The title of your question is ambiguous, but if by "not ready" you mean that you don't have the funds or intent to close, then no.  You should absolutely not write an offer.  If you mean "I'm unsure of the current market value" which is what the rest of your post seems to imply, then you need to get clarity on that before writing your offer.

If you do offer, make it contingent on financing, so if your re-fi blows up for some reason, you can get out and not lose your deposits.

Sales history much older than the last 5 years is useless.  There are triple-deckers in my old home town of Boston that could be bought for $20,000 when I was a kid in the 60s.  Now they sell at $2M+.  That $20,000 value is meaningless.  You or your agent need to run comps to get the current market value.

If it shows as "sold" last month and is now re-listed at the same price, something is up.  The buyer would have spent $6,000+/- in closing costs, only to re-list it 5 days later?  More likely, it never actually closed and it was marked as such either prematurely or in error.  That's a perfectly legitimate question for the seller / seller's agent.

I suppose it's possible that there was a buyer who needed to get out.  Maybe a sudden change in life circumstances.  Maybe he moved in and found that there was some reason that he could not or didn't want to live there.  Again, drill down on that with the seller's agent - and whoever the agent was that helped him buy it if it's someone different.

Theresa Harris · Answer

If you don't have the funds to buy it, then do NOT put an offer in.

Jay Hinrichs · Answer

YUP looking back at sales prices in the 70s or even 80s is just going to make you cry.. as why did I not buy then.. useless info.

Melchire St.ville · Answer

@Ibrahim Yamini

Prices from the 70’s are totally irrelevant at this point. My guess is the most recent transaction on the 3rd party website of might of been a mistake. The property likely went back to active after being under contract with somebody else who possibly couldn’t close.

You can technically put an offer in with the deposit to come at a later date but most sellers wouldn’t accept this.

Joe Splitrock · Answer

It is considered fraud to knowingly sign a contract with terms you cannot honor. If you make it contingent on your refinance, that is different.

Joe Norman · Answer

For the record, I do think its bad form and a bad idea for anyone, including wholesalers, to put in offers/sign contracts that they aren't ready, willing, and able to close on.

Jay Hinrichs · Answer

YUP this is what creates the controversy on BP when it comes to wholesalers who have no ability to close if they cant find an end buyer.. they use white lies to ty up property..  Agents and sellers are getting a little smarter ferreting this out..  if the wholesaler makes full disclosure that's one thing.. but the HEY  I am a cash buyer when I am not.. and the we need an inspection when its really the end buyer etc.. all just reeks.

Joe Splitrock · Answer

What do you disagree with? I said knowingly sign a contract you can't perform on. If you know you can't perform, then that is not good faith belief you can perform. Contingencies are there to protect you from the unknown. That is totally different.

Michael Plante · Answer

Are you looking at actual county records or something like Zillow?

Marco G. · Answer

@Theresa Harris

Point being, be transparent about it with seller and lender, but it can be and is being done. Would never do it without informing seller and lender.

Should you Make an Offer even if you're not ready to buy?

Most Popular Reply