patrick.net

What is "Emotional Attachment" BS these sellers are talking about? Emotional attachment to shacks? If there is competition of places with worst housing BAY Area will be on top, and this is with impending earth quake in pipeline waiting to raze this fictional value also.

I won't argue that realtors are scammers (most probably are) but like I said on Redfin, you dodged a knife.

San Jose is still way overpriced... you're bidding 650K on a house with a "zestimate" of 631K which is just.. laughable. That house is probably worth somewhere in the 400K range if you're lucky.

You should what makes you feel happy, but dang, the mid to high range in San Jose is ripe for a fall. Heck, I rent a "700K" house in Campbell, which is arguably much nicer than the vast majority of San Jose, for $1800.00 a month. Something is wrong with that picture.

http://www.redfin.com/CA/San-Jose/4090-Yellowstone-Dr-95130/home/1249891

And there's the house.

That's very much like the place I rent and I wouldn't even pay 500K for that.

If I contort myself, stand on my head and squint I suppose I can somehow understand how someone could need a to own house so desperately that they would willing degrade themselves by participating in such a "buying" process, not to mention the insane price. For myself they will have to pry the lease on my rental house from my cold dead fingers before I would participate a process of such unlubricated fisting.

You would have paid $650K for that dated crap? I'm sorry to have to be so blunt, but you are out of your mind. I used to live in that area, and it is a dump. I wouldn't pay $300K for it. Again, I hate to be so blunt, and I'm glad you saw the light, but fools like you are the reason this mess persists. What in the world were you thinking?

And furthermore, why but why do you idiots let agents make your decisions? THEY DO NOT HAVE ANYONE'S INTERESTS AT HEART BUT THEIR OWN. Why do people not get this?

Last time I sold a house (I dumped it because that particular market had begun to implode), I told my "agent" that I was going to drop the price $10K a week until the house sold. He said he could not abide with that because it would cut into his commission. I said goodbye to him instantly and sold the house myself three weeks later to a drive-up buyer the next day (they paid cash), pocketing the agent's $23,000 commission and nearly making up for my price reductions. I paid a lawyer $4K to draw up the papers. The sale breezed through with zero hitches in five days. Who needs agents?

Who pays a lawyer $4,000 to draw up a real estate transaction?

During these tough times, realtors should be wary about their conduct and concentrate on the future rather than indulging oneself in a short term spurious gain. It is their responsibility not to misguide general public amidst this crisis.
I think the homeowners and potential homeowner should also stay informed and gather proper information from expert sources.

Read More: http://www.housingnewslive.com/us-housing-news-articles.php

“The sellers received 7 offers and were having a hard time deciding on the one to accept in such a short amount of time. Instead of being greedy and asking for more money, they decided to offer the buyers a chance to ‘stand out’ which they felt was more respectful. Your buyer has proven to us they were not the one to accept and we wish them the best of luck.”

Translation: The greedy sellers received 7 offers but neither of them is satisfactory. Except two, rest of them are low ball offers. So they decided to initiate a bidding war between these top two bidders with a pretense of "opportunity to stand out". And of course playing mind game of bidding war takes time. Due to this reason we cannot respond by 5PM. It's sellers bad luck that your buyer, who is one of those two bidders, decided to withdraw.

"Chance to ‘stand out’" my foot. The seller wanted better offer, it is as simple as that. Just check out the sale amount after one month. Someday Mr Yellowstone will be glad that he withdrew his offer for this 1200 sqft property.

Dear little guy: I did. It was worth it to avoid the hassle of using, er, being used, by one of those sharks called agents. I paid zero interest, zero escrow fees, zero loan fees, zero courier fees, and best of all, zero commission! The agent got zero for snubbing me.

Realtors are doing same old scams,
Mortgage people are doing same old scams - I have friend with 90k salary who bought 500k home as builder used their agent and mis represented his salary

So what is fixed by Obama? What is lesson this system learnt? Lets all do fraud, buy homes for 3.5 % down and gamble and if things don't look ok it is very easy to walk away, may be take few stuff from home to even cover 3.5 % paid as banks do not have energy to recover.

http://southflorida.bizjournals.com/southflorida/stories/2009/09/14/daily52.html

An opportunity to stand out? You played along with this for that house? I've owned three houses in my lifetime. I've found this simple fact to be absolute truth: There are always other houses.
Think about this for a second. Will you really want to pay that much money every month for a little 1200 sq ft house? To live there would be north of 4500/month I guess because there are taxes and insurance to consider. How much would that be for 30 years? If you have to move can you resell it? Note carefully that the door appears to be mis-hung. Hmm. 1.6 Million total after 30 years for that?
I'm sure that once you think about it for a while, you will be relieved that you didn't get taken in on this.
Roidy

Heres the thing. Anyone that would buy a house. With a price like that. Should have their head examined. Or should check into a mental facility. It's nothing personal mind you. I would if you were my neighbor. I would speak to you in gentle low tones. So you won't get riled and start making noises like a excited barn animal.

It's a negative equity real estate market. I would whisper to you. Please don't get upset and I would add and please don't eat my dog. Then maybe a person with rabies might say: the market has bottomed out. People with rabies can't see very well so I am sure they can't read either. The equity spread on that deal sucks. Probably because the owners have their ass over their head in the loan.

Good luck for the next opportunity.

No offense Yellowstone, but..ever hear the saying god protects fools and drunks? IMO you'd be better off renting than buyinganything at this point, let alone some jumped up shack like the one you withdrew from.

You listen to your agent and your are SCREWED. Remember this is how the bubble formed. I'd ask the agent to put 400K offer and move on to next. Desperate buyer like you are delaying the correction in prices(Sorry).

Yellowtone,

I don't want to jump on the bandwagon at this point, because you are getting beat up pretty bad. You did well in telling those sellers and agents to forget it, you will find another house. I am assuming you are renting, why would you want to go from paying 1800/mo. to over 3K/mo. just to say that you own it? My advice is to continue renting, and go something else (vacation home in Mexico, boat, ferrari, whatever) with the 250K that will satisfy what you feel you are missing by owning.

I will say that it really irritates me that someone who has saved up 250K and makes anywhere from 150-200K per year (which is what you'd have to make to afford that house) can also almost make a decision this dumb. What do you do for a living? Can I have your bosses phone number?

chrisborden says

I said goodbye to him instantly and sold the house myself three weeks later to a drive-up buyer the next day (they paid cash), pocketing the agent’s $23,000 commission and nearly making up for my price reductions.

Excellent! Sounds like your would-be broker was a "professional lister." That is, the broker just wanted the listing so that when the house eventually sells, he will get a piece of it. In the mean time, he will put no effort into selling your house, but spend all his time hustling new listings.

I worked with an agent who knew I was interetsed in buying a place. He had a sale pending on a 3 BR condo. I wanted to place a bid at $530,000 but he said that was not high enough. My gut told me something was wrong with the picture because I knew the neighborhood well. In fact, the agent steered me to other properties that he was selling.
The condo closed at $515,000. If the seller knew they could have had a $15,000 increase in the offer, they would have taken it, right? Instead, the agent thought he could keep the sale on the condo and try to get me on another house so that he couls have two commissions.
I dismissed the guy for this questionable perceived practice.
Incident#2: I bid $730,000 on a house. The selling agent said that I needed to go higher. I declined and the house sold at $728,000.
Beware of any real estate agent in a private treaty sale. You could end up bidding against yourself or they may take the lower price and try to move you into another place to get the second commission.

chrisborden says

Last time I sold a house (I dumped it because that particular market had begun to implode), I told my “agent” that I was going to drop the price $10K a week until the house sold. He said he could not abide with that because it would cut into his commission. I said goodbye to him instantly and sold the house myself three weeks later to a drive-up buyer the next day (they paid cash), pocketing the agent’s $23,000 commission and nearly making up for my price reductions. I paid a lawyer $4K to draw up the papers. The sale breezed through with zero hitches in five days. Who needs agents?

What a piece of shit. God I hate f-ing agents, and hardly a day goes by without more anecdotal cases of their non-stop douchebaggery. Congrats on the sale, and for not wasting your money on that human slime.

I've got one, too. I just bought a rental property in a huge, cookie cutter neighborhood. The seller's agent told my agent that the seller had rejected a bid of $125k so I bid $127,500 and she rejected that, too. I gave a final offer of $130k and that was never responded to.

A week later, my agent called to say that the seller had decided she'd take $135k so I signed a contract on his recommendation. When I left my agent's office, I promptly got on the internet and found that a comparable home sale had just been recorded for $128k. Yeah, I felt like an idiot. It appeared that the seller's agent also found the information and used it to his and his client's advantage. My agent had no incentive to look for more recent comps or to tell me if he found one if he did look. I paid too much and he made more money.

I don't belive the part about there being 7 offers on the house either.

$600k for a 1200sf home in San Jose?!?!? I'm sorry but it's buyers like you that keep the ridiculously absurd bay area real estate market as inflated as it has been and still is in most areas. You're part of the problem not the solution.

"I told my agent I hate the seller playing this trick, and consider this a >>greedy

The entire story is amazing to me. I remember the same crap when we bought our last overpriced SJ house (very close to this one) in 1989. Luckily that was many waves of immigrants ago, so it's all funny (and profitable) now.

I remember being astounded when houses on the busy Payne Street. were going for $600K in 2001.

Here is a hint. If your job does not require you to live in the Bay Area, leave. It's basically an overpriced, undergoverned shithole with a high density of assholes. But, there are bad aspects to it as well.

zzyzzx says

I don’t belive the part about there being 7 offers on the house either.

I know real estate agents lie too often, but this time I am taking his/her words in face value. However, overall situation described by Mr Yellowstone tells me that the greedy seller did not have any offer in hand which he/she considers good enough (afterall he/she is greedy).

Keep in mind that the property is in market only for one week. The seller is yet to hit the reality of current market condition. Due to this reason, he/she confused WHETHER to accept any of these offers and move on OR wait for a few more days/weeks because someone might make an excellent offer he/she was dreaming all along.

Wow, this process sounds awful. Yes, the price sounds awful, too, but in general it sounds as though this process does not respect the buyer at all.

For what it's worth, I wouldn't have played their game, either. And I would take the selling agent's barbed comments with a grain of salt. It is entirely possible that your offer was the highest offer on the table, and that they regret losing it. Or that they wanted to play you against the other buyer for awhile longer. Or that there was no other buyer. Regardless, there was no need for the Realtor (TM) to send the nasty little note wishing you well and also implying that you had somehow done something wrong and did not deserve the house. That was mean and unprofessional. You made a generous offer and a reasonable decision. I hope you don't let that evil little note get under your skin.

A woman I know sold her little tiny place awhile ago--just as the market was turning. She and her husband had put in a lot of sweat equity, and they made life terrible for their buyers. Letting go was hard for them, and they had expected more money for all their hard work, so they made life miserable for their potential buyers, asking for letters and money and general groveling. In the end the seller got really hung up on wanting an extra $5K. She almost refused all offers over that $5K, which was silly given that it was a $610K house at that time and the market was clearly starting to turn. Sometimes the emotional piece runs the game.

Realtors are just like used car lot salesmen (or many other salesmen for that matter) they will say and do anything to make a buck often at the expense of the buyer. That being said, this is the nature of the beast. This will not change until the terribly outdated institution of having unnecessary middle men in residential real estate transactions. Now, to play devil's advocate - the realtor is doing their due fiduciary diligence to the seller(if...and that's a big if) the scenario you described is true - after all - a Realtor's job to a seller is to try to get the highest price possible (hopefully in a ethical way)

Again, I acknowledge they may have lied about the number of offers and are just pulling your chain...that is certainly possible - but that is a *risk* they are willing to take if they demand a counter offer and you are the only qualified high bidder (and you abandon the deal as you did.) If they indeed had 7 offers, and your offer (along with the other so-called 'high' bidder') is reality - I agree the seller/agent is indeed trying to milk you and the other party for more money. I just want to remind people that is something they are perfectly legal allowed to do.....I think what pisses you off is the disingenuousness way they presented it (seller attached to the home crap)

You quoted Bill Gates yourself..."life is not fair...get used to it." You'll find the similar tactics in almost any other type of commission based sale.....so 'get used to it." at least until the corrupt realtors association losses their grip of their monopoly.

Now as far as the home market, it believe is still inflated - I agree with everybody here - so you're probably better off continuing to rent.

You would have paid $650K for that dated crap? I’m sorry to have to be so blunt, but you are out of your mind. I used to live in that area, and it is a dump. I wouldn’t pay $300K for it.
If your job does not require you to live in the Bay Area, leave. It’s basically an overpriced, undergoverned shithole

I think you've nailed it. Of course, the last thing the BayArea will admit to is a lack of quality of life. It's probably because everyone is leveraged to their eyeballs to merely eke out a middle-class existence in largely mediocre neighborhoods with sagging infrastructure. The house in the OP is very average for towns across the US—except that elsewhere these homes go for a fraction of the bidding-war-pumped SFBA price.

Despite all the local hype, once the credit crunch washes over the SFBA, this place will look no different than Flyover USA. Except perhaps to the uppity poseur crowd, who will maintain it's "special", lmao.

Clearly the biggest crime in this story is attributing such a motherhood and very old quote to Bill Gates. What's up with that???....

The house is still for sale. So the realtors were definitely lying about the other offers.

Business as usual.

When will it finally become illegal for realtors to block all access to the actual seller and to other buyers?

Why don't we finally get an open market for real estate sales, with all bids and asks publicly listed?

I think things won't really change unless and until everyone just stops buying in and says NO to the games and overpriced houses. The Bay Area seems to be a magnet for the stupid and the greedy, but at least on this forum there are some who see through the scams. I left a few months ago and have no regrets. The place is shallow and stale. The weather simply was not a good enough reason to stay.

Thanks for the research Patrick, again - I can't say this enough....great job on this site....

That being said...this realtor just smoked the seller - they had 650K....done deal....

Can realtors be sued for communicating false number of offers? There has to be solution to this outright fraud of lies with number of offers. Anytime i meet my realtor I feel like I am meeting scam artist and in his words these days - there is never better time ot buy but if I buy now after little time I will look back and I will be happy I bough t a shack in Fremont.

And If I mention effect of closure of Nummi he is silent - saying it won't have much effect,

You want to see transparent? Go to www.kazork.com. Even more transparent than Ebay. Can see all offers made, by whom and when. No guessing. No bait & switch. Awesome system.

liveconfused says

Can realtors be sued for communicating false number of offers?

The answer is yes or no. If I lie for no reason, can you sue me? Lying is freedom of speech too. So what would be ground for lawsuit? The agent misled you with lies and that caused you to make offer with higher price? Read the original post carefully. The seller asked the bidder to "stand out". Although from this "stand out" phrase the bidder gets the underlying implied message of "give me more money", but it is going to difficult to prove legally in court. Basically, in court it will boils down following:

1. The seller asked you to "stand out". This "stand out" could mean anything, financial or non-financial - proving yourself more qualified, you can increase your down payment, you can remove contingency from offer or writing a nice emotional letter saying "I would like to educate my kids in good school".
2. After hearing "stand out" you decided to make offer with higher price.

Bottomline, seller did not ask you to offer higher price explicitly. You volunteered. You have no case.

Realtor's ethics book says that agents are not supposed to lie about material facts (e.g. number of offers), but as long as they are not breaking any legal rule, nothing stops them from lying.

By the by, that property is still being actively marketed, with 2 Open Houses scheduled for this weekend; so you were definitely being "played." We encountered a LOT of that during last year when we had finally determined the market was right for us and started shopping. Those "highest and best offer" letters are just a shortcut to Ulcer-ville. In the case of THIS house, I think their agent talked the sellers into listing it lower to get more interest but the sellers still have big eyes and unrealistic expectations. Check the comps for the neighborhood because if your house doesn't appraise for what you bid, the bank won't give you the money. Wait for this house to fall out of escrow a couple times because the prospective buyers' funding fell through - THEN bid on this house again. My advice, fwiw.

Could you write an offer where you include a clause that the seller has to prove there was another offer by giving you a copy of the offer after the sale goes through? I know the seller won't tell you the price of the other offer while the house hasn't sold yet, but once it has sold to you, there is no reason to keep it secret. And in the clause, you get back the difference between your "better" offer and your original offer if there was no other offer. If there was a better offer or at least competing offer then you get nothing since everything was legit. I know there are still ways around this, but maybe it would prevent some deception.