Multiple offers doesn’t mean you’re overpaying
Letter to the Editor
By Inman News, Friday, August 31, 2012.
Re: ‘Survey: Buyers think market is shifting against them‘ (Aug. 29)
Dear Editor:
I am often amazed by articles from companies like Inman and Redfin, and how one sided or incomplete they are while making a broad brush statement.
Yes, prices are up in certain ZIP codes in the East San Francisco Bay Area, and often we have multiple-offer scenarios. But when I told buyers in January of this year to buy property NOW, they often responded, “The market will still go down, and you only want to make a commission now.”
Article continues belowI often do statistics in my area (just like I did in 2007 when I told buyers NOT to buy property), and already saw this increase happening in the beginning of the year. But even today, and even with multiple-offer scenarios, real estate is still fairly cheap.
Your article only looks at price, and not value. I have shown many times the difference in buying with renting. Not just a simple calculation on paper but a serious investment analysis over a seven-year period. Many times it is cheaper to buy than rent.
Multiple offers does not necessarily mean you are overpaying for the property. In many cases, even with the overbid price, the amounts offered compare to 2003-2004 values.
Money is cheap. If you can get it, borrow as much as you can (my financial opinion). In a couple of short years, when the inflation hits, 3.75 percent interest will seem like a real bargain. Many buyers forget that.
Antoine E. Pirson, MBA
Broker Associate and Real Estate Investment Adviser
Caldecott Properties
Oakland, Calif.
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