It sounds to me (I’m not a realtor, etc. just a regular person) that the seller does not really want to sell. In what might be a somewhat similar scenario, the house I’m in now was bought from a couple where the woman and her father actually owned the house. She forged his signature when accepting the offer, then called my realtor and told her it was forged. It turned out the couple was in backruptcy. Now I’m not a financial expert, but basically the people sounded kind of crazy, and insolvent, and didn’t want to move, but they basically had to. So perhaps your sellers were in some sort of fix where they were being forced to market the house, but really did not want to sell it.
I’m not a realtor or a lawyer, but I always thought that if someone offered you your exact asking price, you pretty much had to sell to them or take the thing off the market? I realize that’s not the precise issue here, but it would seem to be related.
<nitpick> Loach, you “accept” an offer, not “except.” “Except” has to do with leaving something out. </nitpick> Sorry, couldn’t resist.
Not in the least. In the housing market out here, for example, it’s more common to get offers above the asking price due to a shortage of housing in a particular price range.
Even if that’s not the case, even two offers for the same price can lead to vastly different amounts of money into the pocket of the seller (say that one offer came from somebody not using a buyer’s agent, which means that the seller doesn’t have to pay the buyer’s agent commission…), while another same-price offer is contingent upon you replacing all the carpeting in the house prior to close.
-lv
The couple selling the first house told me they were moving to Beachwood, because they found and subsequently bought a house a block away from the Hebrew school their young son was attending.
Good point, and if that’s the case, it’s a situation that I don’t want to face when it comes to the post-inspection nickel-and-dimeing. Even if the “offer far, far less” strategy worked, I might not want to deal with whatever might come up between signing a contract and closing.
I’ve bought two houses in the past, and usually accept minor faults after the inspection. Likewise, whenever someone bought a house I was selling, I’d usually fix whatever needed to be fixed. I try to be an easy buyer and seller.
Another good point. I think I’ll watch realtor.com, and see if it shows up.
I’m glad that’s not the case in the Cleveland area. I paid list for a hosue I bought in Denver several years ago; there was a bidding war when I sold it.
'Tis true. I made an offer on a different house today – a block or so away from the first house – and after a bit of negotiation, signed a contract. 
On 15 October, this will be elmwood’s new house. Smaller than the first, but completely redone from top to bottom, and on a deep, forested lot that terminates at a creek. Dopefest?
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it is possible that the seller got an offer for the full price and when you called decided to roll the dice and see what happens.
I have heard of houses being under priced so that a bidding war can be started amongst prspective buyers. Beware of those.
Had a realtor that told us that he peeked at the desk of his coworker that was selling the house and the high bid happened to be there about 5k more than ours… we got caught up for about 48 hours, then slapped ourselves awake and raaaaaaaaaan
Looks like a fantastic house, elmwood. Congrats!
Terrific house! Congratulations. I concur with the others that you probably wouldn’t want to have dealt with the first person, anyway. FTR, I think your offer was extremely reasonable given the asking price. My opinion is that if you price your home at a certain level, you should be willing to accept that price, not change your mind once you get a reasonable offer.
I think, if I remember correctly, that reminds me of the Futurama episode where Amy buys a car where the salesperson negotiated way above asking and the robot manager gets so excited his head explodes. I may be wrong.
INHO there is no reason for either buyer or seller to consider offers or counteroffers as “insults.” Insults are personal attacks, and there is no personal attack in a house sale negotitation. The seller wants his price; if he doesn’t get it then he’s not compelled to sell. If the buyer and seller can’t do business then they should just politely disengage and let each go their separate (sp?) ways without hard feelings and without calling each other names.
Disclosure: I am a Realtor.[sup]TM[/sup]
It’s not unusual in a hot market for offers to be made above the asking price. Although it doesn’t seem like this in your case, it is possible the seller got much better offers than he expected and decided to go for the max.
It’s also not unusual for an asking price to be waaay out of the market. Either the seller hasn’t done his homework, or he hopes someone will come by with an unlimited checkbook, fall in love with the property and buy it without doing his homework, either.
Rare, but I’ve seen it happen at least twice in my neighborhood recently. It tends to distort the market until others realize this is only a one-transaction blip, not a general trend. An agent that knows this can either protect or exploit you.
IT can go the other way, too.
I moved states 6 months ago and bought a house here contigent on selling the old one. I priced the old one, in a hot market (northern Virginia), below the going rate. I sold it in four days. But selling it was the goal…not necessarily getting the highest price possible.
Well sure, if the people you are dealing with are reasonable, rational adults this is how things work. But lots of folks out there aren’t, and sometimes there are emotional issues involved with buying and selling houses that make otherwise sane people do crazy things.
elmwood that looks like a great house, congratulations! What suburb did you buy in? I’m from Cleveland (will be back in October to visit the 'rents) so I’m always interested in hearing about the housing market there.
Where i live sales above asking price are common - but wouldn’t it be expected that the seller would inform the buyer of a higher offer before making the counter-offer? Or just not accept it?
I didn’t have this problem when I bought my house but my impression is that the seller gets multiple offers, takes the highest, and does not engage in an auction. (I’ve read enough from people who bid too low, did not get the house, and did not get a second chance.) What is the procedure?
Thought I’d relate a funny little negotiation story when Mrs Gargoyle and I bought our first house. We did it all FSBO with no realtors, so it came down to make an offer and Mrs G and I are sitting in the kitchen with Mr & Mrs Seller…fortune favors the fool, as they say…
Me: “So the house is $210, right”
Mr Seller: “Yep”
Me: “That sounds fair, I like it. We’ll buy it!”
Mrs G: smacks me in the side of the head
Me : “What? That’s good right? We said earlier we liked the house?”
Mrs G: “Honey…we’re negotiating…”
Me: “But we like it, right? $210 then”
Mrs G: “You don’t get it…”
Here’s where it gets really surreal…
Mr Seller: “Look. We were first timers when we bought this house also. We understand…we’ll let you talk…”
Mrs Seller: “Right. For example, you say ‘well, the windows need replacing…’ then we say ‘ok, how about $205’, then you say ‘well, we want to do the floors…’ so we say ‘ok, how about $200’. So let’s start there then? How’s that?”
Me: incredulous look “Um…ok…the windows need work, and we want to redo the floors…how about…oh, I don’t know…$200?”
Mr Seller: “Hmm, we can live with that”
Me: “Ok, we’ll take it for $200!”
Mrs Seller: whispering “…we can still negotiate…it’s ok…we won’t be insulted if you do…”
Me: “Seriously? You mean if I wanted to swap out the fuse box?”
Mrs Seller: “Yep.”
Me: getting into the rythm now “Ok, well, given the windows, floors, fuse box, and…” looks around…"…that old stove and refrigerator…we really think $198."
We dickered a little more, and ended up having the sellers hold our hands as we fearless and ruthless negotiators talked the house down to $192. They knew that they had posted the house overpriced to cover negotitating room, but their consciences were such that they didn’t want rip off us newbie buyers too badly.
We asked them after we had signed the papers what we each were prepared to pay. I was prepared to pay $220 for it, they were prepared to go down to $185, so we both left the deal completely happy 
[QUOTE=elmwood]
Seller is FSBO; I’m using a realtor.
[QUOTE]
Maybe that’s the problem - the seller saw that you had a realtor, though “Oh, damn - I’ll have to pay the commission to his agent,” and decided to jack up the price to cover it.
I’ll be there! Nice house…looks like the seller read that article in the Plain Dealer about stripping your house of almost everything in order to sell it. Too bad that didn’t extend to the “Wassup?” sticker on the fridge!
We bought our condo during a hot period in the LA market two years ago. Our initial offer was over the asking price because we expected to get into a bidding war (and did). The owner came back to us and offered to sell us the condo if we matched the highest offer she’d received from another bidder, which we gladly did.
(The seller was a recent widow and my wife and I have two small children. She liked the idea of a new family living in the space that she and her husband had shared. So she gave us an extra break.)
During the period between when the offer was accepted and when we closed the market exploded. Our realtor told us we probably could have turned around and sold it for an $80K profit. Of course then we wouldn’t have had a place to live … .
So, yeah, in a hot market I can see a seller behaving like the one in the OP. However, it would have been more courteous to offer some explanation for jacking the asking price.