Frustrated Buyer

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Buyer Frustration

Dear Phyllis,

My parents have used the same real estate agent for more than twenty years. I also hired him to buy my first condo. My fiancé and I are ready to purchase a home. I don’t have to sell my condo and will likely keep it as a rental. We have looked at a few homes and have had our eye on several. We have a good down payment (nearly 25%) and FICO scores in the high 700’s. Our preapproval is in order. I understand the current market is competitive, but I feel that we are in an excellent position. We can afford $1.2 million and are looking for up to $1.3 million in Glendale, Pasadena, and La Crescenta. Our real estate agent, however, is reluctant to show us homes in our price range. Therefore, he keeps pushing us down in price. Frustrated Buyer

Dear Frustrated Buyer,

The competition in your price range is fierce. I understand and sympathize with your frustration. It is common for sought-after homes in desired Los Angeles neighborhoods to sell for more than a hundred thousand dollars over the asking price. Recently, when checking the MLS (multiple listing service) I came across a Pasadena fixer that was listed at $1,099,000 and sold to a cash buyer for $1,615,000.

When viewing homes, it is important to notice whether there are showings scheduled both before and after yours. In many cases, these buyers will have equal or often larger down payments, along with FICO scores similar to yours or even higher. In addition, some of the buyers you are competing with are waiving appraisal contingencies.

As a result, looking at new listings priced over your comfort level is most likely a waste of everyone’s time in this market. Most desirable homes in your price range are selling within the first ten days. Typically, they receive multiple offers and, in many cases, sell over the asking price. However, once a home has been on the market for three weeks, there is often some negotiating room.

Therefore, ask your Realtor why he is pushing your price point down. In addition, suggest that he advise you of the actual selling price of each home you inquire about. Most of these homes are likely selling in multiple offers and substantially over the asking price. Ultimately, your real estate agent may simply be trying to narrow your search to homes you can realistically afford.

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