It begins when sellers offer their listing and hold open houses, but won’t look at any bids until a set date. This can also be termed sellers holding back offers until a specified date. If a buyer cannot wait until this date because the property is perfect, they place what is called a preemptive or “bully” offer. This offer usually comes with the catch that it must be accepted right away and forgoes any waiting until the set date.
Should You Entertain Bully Offers When It Comes To Toronto Real Estate?
A real estate agent will be able to let you know if the property is over or underpriced and help you come up with an offer the sellers can’t refuse. If the offer is accepted, the buyers who waited like they were supposed to are then told the property has been sold, leaving them understandably upset – but it’s all a part of the game.
Bully offers can also be used to test the waters. If a property seems underpriced, a bully offer can test what people will take or leave. If the sellers still don’t accept, these buyers can then have a better idea of what they will need to bring on the set offer night.
Bully offers for sellers:
Sellers can profit from holding out until a set date, but it can also cost them dearly. If they decline a high bully offer, they may find themselves with nothing but lower offers to choose from later on. Sellers could be coached by their agents to not entertain bully offers, and unintentionally be forced to pass up building offers for a higher price than they will ever see when it comes time to review bids on offer night, which can lead to thousands in lost profits.
Fully consider each offer, whether you’ve set a specific bidding date or not. A bully offer may or may not be the highest offer you receive.
As a buyer or a seller, consult with your Toronto real estate agent to ensure you don’t overpay as a buyer, or lose out on money as a seller.
The results of a recent poll of potential Canadian homeowners were presented at the 37th annual Canadian Home Builders’ Association conference earlier this year. A recent study found many Toronto renters plan on becoming homeowners soon. Some of the key statistics...
The real estate market is stable in Toronto right now, but with a stable or booming market comes an increase in real estate fraud, namely mortgage fraud. The Toronto real estate market is stable, but protect yourself against fraud. There are two common types of real...
According to the latest Toronto MLS Listings stats from the Toronto Real Estate Board, home sales in Toronto were up by 21 percent during the first two weeks of October 2021 compared to the same time last year, with a total of 3,460 sales. Sales in the first half of...