OVERBIDDING VS UNDERBIDDING

Had to laugh at a recent headline in one of the on-line so-called expert sites regarding Real Estate. The BIG NEWS was that “Underbidding” was back and prevalent in many GTA neighbourhoods. Underbidding? Since when did THAT become an issue? Like when someone is asking $1.2 Million for a property and you have the temerity to offer them $1.1 Million? Excuse me, but isn’t that what used to be considered the norm? Seller lists a home for X dollars. Buyer sees home and puts in offer of their version of X dollars. Now it is up to the realtors to come to a mutual agreement that sees both parties relatively satisfied with the outcome. Seller sells home for considerably more than they paid for 10 years ago (in most cases). Buyer gets to live in area they have always wanted to live. So both sides are happy, right? But a funny thing happened 5 years ago that was probably brewing for many years before that. Check out this stat from Europe: According to Eurostat, house prices in the EU rose by an average of 5.4% year-on-year in the second quarter of 2025. Seven countries recorded increases of more than 10%, with Portugal (17.1%), Bulgaria (15.5%), and Hungary (15.1%) recording the strongest growth. Croatia (13.2%), Spain (12.8%), Slovakia (11.3%) and Czechia (10.5%) also posted double-digit increases. So it would stand to reason that there was an expectation in Canada to constantly see home prices rise. And I get that. But it used to take about 10 years to see your home appreciate by $100,000.00 or more. Average yearly increase was around 10K. Then the madness hit and screwed everything up. So the market has been trying desperately to correct itself over the last 2 years and maybe more. I’ve said before the last time there was a softening like this was from 1989 to 1998 and it looks like we could be headed that way. So what is with all this bleating about underbidding? Isn’t that just a return to what used to be a normal process? And isn’t that part of the whole negotiation that’s an integral part of deal making? We are not in 2020 where agents with no clue were just throwing For Sale signs on properties and letting the buyers determine the value of the home through their offers. Sorry to say but agents now have to do some homework and come up with a reasonable ask price for a home. And in most cases the buyer will still want to offer less. That’s what they do. Both parties can agree (or not) on an equitable sale price and voila. You have a deal. But to undermine and pooh pooh “Underbidding” is really silly and just one more media angle to glorify or sully the business. Funny thing. How many regular real estate columnists were doing their thing on a regular basis 40 years ago? Yup pretty much zero. It’s like the wild craze for Sports TV columnists in the 80s and 90s. Where are they now? But Real Estate always has and always will be a popular water cooler (or party) conversation. Which is good. As long as they keep the facts straight. Feel free to check out this story and more on my blog site at: https://slackie14.wixsite.com/buy-sell-and-more