All Forum Posts by: Mike Petrosinelli

@Collin Hays very well said! Panic buying. To me that’s when my antennas go up and they say… slow down rather then speed up. I wonder how many people are really doing their “due diligence” before walking into these deals. I think they are worried the train will leave without them. To me, you have to know your own rhythm. Trying to “outbid” others in inflated doesn’t jive with me. I think there are hidden gems but sometime stop and think outside the box. I haven’t bought in this market yet but might…. Only if it makes fiscal sense. My 2 cents… 

As Russell mentioned, offer 10k, 20k, 30k, even 50k over asking and I bet you’ll start beating out those cash offers. 

If I was selling my house and someone offered me $500k cash, 10 day close, no contingencies and another individual offered me $550k, 45 day close with a 7 day inspection period, I wouldn’t even think twice about it. I’d take the $550k offer. 

Cash offers are great for motivated sellers. They need that money right now! The $550k offer can fall through and I would have to relist and wait for another offer to come through.

However, if you’re not in a position where you need the money immediately, the $50k over asking offer is more attractive, at least in my opinion. I have to wait a little longer and have to risk the deal falling through but I walk away with more money at the end. 

Given that your buying an STR, I would be willing to bet most of the sellers are not motivated sellers.

That being said, offer more and I’m sure you’ll start beating out those offers. 

Good luck! 

I have both purchased and sold STRs in the last 12 months.

When I find a deal that I want, I make a cash offer and close the next week.  No appraisals, inspections, etc.  Right now, that's the only way to get the really good deals, as if you have any "ifs and buts" in your offer, or if you have to "think it over" for a few days, you've lost.  There are cash buyers standing in line to take your place.  This is still very much a seller's market.  If you want to play, you play by the seller's rules.  

After the sale, I simply got a mortgage on the property through my local bank and pulled my cash back out.  But getting a mortgage isn't a part of the buying process.  If it is, you aren't getting the good deals.

This summer, I sold a STR to a buyer that had to obtain a mortgage. I liked the folks and decided to work with them and wait it out. Well it took 3 months to get the thing closed, and was an ordeal. So in hindsight, I should have just taken the easy way out and accepted a cash offer.

There will come a day, sooner or later, that it is very much a buyer's market. I've seen that and lived through it. I recall just a few years ago in Gatlinburg that STR owners were walking away from their properties and handing the keys back to the bank (remember the short sales?). Banks were then begging buyers to make them an offer - any offer - to get the house off of their books.

I recall one fellow that bought a cabin in Cosby in something called the Maranatha Resort.  He paid over $800,000 for it.  Had an indoor pool.  The financial crisis hit, he couldn't make the payments, gave it back to the bank, and someone bought it from the bank for just over $200,000.  Today it's probably back to $800K.  Maybe $1 mil.