What a crazy housing market this is! My #1 son and his GF just
found out that their offer has been accepted.

Here is how houses are being bought these days€¦

First, I should note that the submission period for offers was the 48
hours after the house hit the market. This was one of those listings
where all offers would be reviewed at the same time and the sellers
would choose the one that they liked the best.

Since my son and his GF are relocating to a different state, they
havent even seen the house in person. Just pictures, a video tour
and their agents assurance that the house was listed at a great
price, way under what she expected it to sell for. (She was right)
They submitted their offer within a few hours of the house being
listed. There was a total of 12 offers submitted in that 48 hour period.

They submitted an offer at full asking price ($370K), no contingencies.
The offer included an escalation clause. The escalation clause would
automatically increase their offer to $1000 more than the highest offer
submitted, but not to exceed $410K. They also included an "appraisal
clause" which stated that they would give the sellers up to $15K above
the appraised value, not to exceed $425K.

Their offer was accepted, not just based on the offer price, but also
based on the appraisal clause. Another offer also had an escalation
clause that maxed out at $410K, but the appraisal clause was only
$13K above the appraisal value, $2K less than their offer. That was
close!

So they may pay as much as $425K, but they may pay less than the
$410K if the appraisal is low €“ assuming its not so low that the seller
backs out. Their agent is sure that the appraised value wont be low
enough for that to happen. The seller is moving out of town and needs
to get the house sold, thus the comparatively low asking price.

One other clause was a 15 day due-diligence clause, which was
accepted. Even though the offer was €œas-is€� and not contingent on an
inspection, they are still going to have one done and can use that to
negotiate repairs or get out of the contract if the sellers disclosure form
is not accurate. They are hoping that at least one of them can be present
for the inspection.

If the house appraises at the $410K level, they will end up paying $55K
(15%) over the listing price. Holy crap!