Thursday, May 21, 2009

Buyers scramble for bargains

Posted on Cyberhomes by Lauren Baier Kim:

Bidding wars are back. But these competitions aren't like those of the housing boom, where homebuyers bid up already high-priced homes to new highs.

Low end heats up

Instead, these bidding wars are taking place in markets like Florida, Arizona and Florida, where there is a high inventory of foreclosures and other entry-level priced homes. In these states, first-time buyers, anxious to pick up foreclosures and significantly discounted homes before the housing market starts to inch back up, are vying against each other to snap up bargains in the lower tier of the housing market. Some sources even report that there are would-be buyers who are are losing out to higher bids multiple times.

Signs of a bottom

In some cases, the wars are sparked by savvy agents using artificially low prices to attract buyers, say sources like the Burbank Leader, in California. Especially in the lower half of the market (with homes priced to about $500,000), such pricing tactics sometimes reap sellers tens of thousands of dollars above their asking prices, the newspaper says.

Meanwhile, says there are signs of a housing market recovery in Florida and Arizona, with sales in Florida of existing single-family homes for the first quarter of this year up 25 percent, and Phoenix in Arizona seeing more homes sell than at any time since 2006, the website says.

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