Sellers have the ability to set the list price where they want. Typically anyway, if the seller is forced to sell or it’s a bank owned property other factors come into play that require the owner to sell the property for a minimum price. Too high of a sales price and there won’t be very many at the open house,priced too low if any at all. Too low of a price can also present a problem, but not necessarily as it relates to the current owner.

Owners who must sell quickly are often under the gun and have to sell the property before the bank forecloses. That means the home will be priced well below market to attract as many buyers as possible in the shortest period of time. However, when the home is priced at a “too good to be true” figure, that unbelievable deal won’t last very long. Why is that? If the home is in fact listed well below recent sales in the area it will attract a ton of potential buyers. Have you ever walked through a property and there were several other people walking around the house with a tape measure, filming the unit with their mobile phone and making notes? They’re probably investors just like you. And they saw the very same listing you did.

The problem with this approach, at least from the investor’s perspective, is the selling price will rarely be near the original amount. When you’re inspecting a property with your contractor and there are obviously other investors and contractors looking at the property the same time you are, suddenly there’s a bit of urgency. Your notion of a very good deal is confirmed by others. Lots of others. And these are just the ones you see. How many others will walk through once you leave today? And tomorrow? Can you see a bidding war coming up? That’s likely what will happen. Other investors see instant competition and the offers begin to mount. That excellent deal turns out to be an excellent strategy—for the owner, not the buyer.