If know anything about rugby, you’ll know what a scrum is, but if you don’t, let me explain at least what it looks like. At certain points in a rugby game, players from both sides gather in a tight circle and the ball is dropped in the middle. They are snuggled tightly together, all struggling to gain control of the ball. That is a great analogy for what is happening in the current sellers market. It’s hard to explain why it is happening, but the inventory for listed properties is at an all time low. That makes it even more difficult for buyers than in a normal sellers market. The “scrum” starts as soon as the ball is dropped (a listing hits the market) and buyers scramble to beat the other offers.
The result of such intense competition for listings is that many buyers become discouraged and drop out of the game, while others lose out and retreat to lick their wounds. The losers usually get battle savvy after losing out in a couple of such scrums.
In one recent case, buyers who had lost out on multiple purchases (because they had continually presented anemic offers), finally decided to put their best offer forward and offered $15,000 above the listed price. Their offer was cash, with a quick close and virtually no contingencies. The day the listing hit the data base, they and multiple other buyers rushed to the scrum, offering what each thought was their best. The buyers mentioned above were competing against seasoned buyers who had learned by experience, and they lost out, despite the fact that they put their best offer forward.
You can bet the next time a property comes available they’ll be quick to remember the scars from the last try. The battle is real folks! We don’t know how long it will last at this sort of intensity, but it is real. If you are a buyer and really wish to claim the prize at the end of a frenzied scrum, then you should be locked and loaded with a strategy for the next chance. Have your money available and the proof of such funds or financing, be prepared to stretch on price and terms and don’t be afraid to take a few risks, such as removing inspection contingencies or other barriers that might make your offer less attractive. Be the stronger one who pops out of the scrum with the prize!