is active/pending short sale a sales tactic?

Question

just wondering...been watching certain houses on the market for almost a year with these labels on mls. I still drive by those certain houses once in awhile with for sale signs in front still.

from a definition stand point, Active/Pending-Short Sale - Offer has been accepted by seller and has been presented to financial institution but has not been accepted - property is still available for showing and back up offers are being accepted.

i know short sales take awhile to close but even some houses that hit day one have this active/pending label. thinking this a tactic to create an illusion of another fake buyer to drive up price.

one house keeps changing price up and down on listing, how can this house be pending a short sale if the listing price keep changing?

John Milliken · Answer

that response give me a better prospective of what is happening.
thank you for the detail response Laura.

Laura Marshall · Answer

Hi John. I am a real estate broker, and new investor. I have successfully negotiated and closed almost 100 short sales. When an offer is submitted to a lender (or multiple lenders), the approval process can take quite some time. If the original buyer backs out, a new offer must be submitted and the entire process starts over. I am in Southern California, and out inventory is very LOW. When we had an abundance of inventory, I always left my listings available for back up offers. Sometimes I still do if the buyer is shaky. This is my best guess as to what may have happened...or at least 1 possible scenario. The property was listed (too low) at $165,000 and they had an offer which was submitted to the bank. In January, the bank came back and countered at $220,000 so the buyer walked (or possibly walked while waiting for the counter). The property went back on the market, and didn't move, so the agent did a price reduction in April. The bank may have countered again, and the buyer most likely found something else...as now buyers are placing multiple offers on properties hoping to get something. I have had buyers place offers on my listings, and others at the same time. Then they just go with whatever comes through first. If you are interested in this property at a price point around $200,000, I would suggest contacting the agent. Let him/her know that you are serious and will hang in there as long as the process takes. It is always good to make back up offers on short sales, because many of the buyers get tired of waiting. In the Southern California market, it is a great time for investors. Many of my clients are willing to pay full market price at the time of the listings, and by the time we close the price has increased. One of my clients just closed on a short sale at $118,000 and the day after closing opened escrow with a new cash buyer at $172,000. The fair market value at the time the property was listed was actually about $120,000. I hope this helps.

John Milliken · Answer

here is when the house i'm talking about is changing price...

05/16/2013	Price change	$203,000		
04/24/2013	Price change	$197,500		
01/08/2013	Price change	$220,000		
09/25/2012	Listed for sale	$165,000