New Quarter New Comps

[Mary B.]

Hey BP,

Wanted to share an experience with you that I recently had. I'd found a great lead that was FSBO with pretty good comps and even better it wasn't a full rehab but just some TLC needed. Would have secured the property for 50% of the ARV and the neighborhood is very in-demand offering the best of all exits.

So I placed an offer with one of the owners but there were 2 more owners that had to be consulted as well. This was not an issue as they were collectively motivated sellers. It was around the 24th of June and there's graduations and vacations all in the mix. General business policy is that all written offers expire after 72hrs which is clearly stated in the agreement and verbalized to the seller(s). Mean time and in between time the seller that I met with at the property and I are conversing now and again about schedules and securing consent to accept the offer from the others. Needless to state the 72hrs has lapsed and they wish to meet again. Its now the 6th of July lets say and we all go over the agreement and make some adjustments etc. and I secure a counter offer to discuss with my partners(I'm in wholesalers mode on this deal).

Now before I run this by my partners then submit my final offer I decided to once over everything CMA in particular. Low and behold the numbers have dropped $20K on the 3br SFH in the immediate vicinity. I did them a 3rd time to be certained. From $117K, $125K, $145K in the 2nd quarter to $99,900; $95,000; $97,500 in the 3rd quarter(I work off of 90day comps). Needless to state the options were no longer the same and my offer would have to drop at least seven thousand. However during a previous conversation with the owner they'd mention an in-law being an investor and offered them the price that I'd now be forced to offer but they had vehemently turned it down. Basically, its one of those I hate to but I must walk away.[yes lease/option would be cool even to wholesale the lease/option but I still needed that offer to drop and the owners weren't having it...]

NOW I get why the banks are in such an uproar to get rid of REOs by the end of each quarter! I won't state that I'll give up making offers during the end of the quarter because it would be most foolish to do so but I'll be more alert for sure and will likely not do a fast closing like normal.

Has anyone else experienced this? If so what was the result? Did you catch it before closing or were you forced to walk away?

Kudos,
Mary