Offer rejected on a house

reflexon · 17th March 2008

Im sooooooooooooooo pissed right now. I submitted an offer on a house on Saturday. They got another offer 3 hrs before mine. Just found out that they accepted the other offer. No counter, no call no nothing. Just looked on a real estate website and the house now says option pending. Called the agent and she spilled the beans.

This place had a separate studio in the back that would have been perfect for me and my gear. It was well within my budget. I literally want to punch the computer screen.

I was going to submit my offer a day earlier, but I wanted one last piece of advice from my boss(this is going to be my first home purchase). I cannot explain how frustrated I am. I have been looking for the perfect place for my home, gear, dog, and girlfriend for almost a year. I finally found it and its fukking gone.

AAAHHHHHHHHHH!!!!!

zboy2854 · 17th March 2008

Well, unless they've signed a contract you could always see what the accepted offer was and raise it and see if they'll take yours instead.

If not, all's not necessarily lost anyway. Just because they accepted the offer from the other buyer does NOT guarantee they will close with that buyer. Especially the way things are right now, the buyer could fail to get the mortgage approved, the inspection could turn up something he/she doesn't like and back out on the contract, etc. There are all sorts of things that can still happen.

So if I were you what I would do is this. Make sure the seller knows that you are available and interested if the deal with the other buyer falls through. These things can and do happen more than you might think.

And even if you do lose the house, I wouldn't worry too much. The way the housing market is headed, there will be plenty more properties at bargain prices to choose from over the next year or two.

reflexon · 17th March 2008

yeah they've already signed a contract. It might fall through, and yeah, i might find something better. I just can't understand why they wouldn't want people to get into a bidding war over their property. Why would you accept an offer when you know you have another one coming in a couple of hours? Why wouldn't you want two parties to bid against each other?

Another thing, they bought this house last June, so why the hell are they in a hurry to pay short term capital gains? This is not their homestead, its an investment property that they did major renovations to. I realize that they might roll it into another property, but why would you not want the option to cash out economically when you are so close? SOOOOOOOOOO PISSSSSED. Im sure ill get over it in a day or two, but right now i am furious.

Thanks for the encouragement zboy. It helps me not punch things.

NathanEldred · 17th March 2008

Quote:

Originally Posted by reflexon

Another thing, they bought this house last June, so why the hell are they in a hurry to pay short term capital gains? This is not their homestead, its an investment property that they did major renovations to. I realize that they might roll it into another property, but why would you not want the option to cash out economically when you are so close? SOOOOOOOOOO PISSSSSED. Im sure ill get over it in a day or two, but right now i am furious.

With capital gains law you have to own your house for 5 years and live in it for 2/5 years. They probably think that was too long to wait until 2012. If they made a profit there is a chance one of the owner doesn't make a ton of income so they'd still be in a lower bracket (only the profit is taxed not the gross). Even then 75% of the profit now compared to paying property tax and insurance each year for the next 4 years (5 years total) is probably desirable.

reflexon · 18th March 2008

Quote:

Originally Posted by NathanEldred

With capital gains law you have to own your house for 5 years and live in it for 2/5 years. They probably think that was too long to wait until 2012. If they made a profit there is a chance one of the owner doesn't make a ton of income so they'd still be in a lower bracket (only the profit is taxed not the gross). Even then 75% of the profit now compared to paying property tax and insurance each year for the next 4 years (5 years total) is probably desirable.

Capital Gains Tax Rates: Tax Rates for Short-Term & Long-Term Capital Gains

I believe you are referring to avoiding paying capital gains at all, long or short. I was referring to them paying long term instead of short. Please correct me if I'm wrong.

And yes, I have put in a backup offer. Just have to wait and see.

zboy2854 · 18th March 2008

Quote:

Originally Posted by reflexon

Capital Gains Tax Rates: Tax Rates for Short-Term & Long-Term Capital Gains

I believe you are referring to avoiding paying capital gains at all, long or short. I was referring to them paying long term instead of short. Please correct me if I'm wrong.

And yes, I have put in a backup offer. Just have to wait and see.

If this was an investment property for the seller, that's probably why they didn't wait for your offer before accepting the first one. Given the current environment, a lot of investors are still holding properties that are bleeding money every month for them, and are just desperate to get out without worrying about trying to get people to bid the property up.

Anyway, keep your fingers crossed, your backup offer might just get accepted. If you haven't already, you might also want to get pre-approved on your mortgage, so if the other buyer falls through you can step in and close quickly.

NathanEldred · 18th March 2008

Quote:

Originally Posted by reflexon

I believe you are referring to avoiding paying capital gains at all, long or short. I was referring to them paying long term instead of short. Please correct me if I'm wrong.

You asked why they were in a rush to pay short term capital gains taxes. I told you the benefits to them versus the non benefit. And no, I wasn't referring to avoiding capital gains taxes. See the last line I wrote where I said "75%...". The 25% less I was referring to was their possible tax bracket. They would get taxed 25% as just a guess, it could be a little more it could be a little less depending on their personal income. 25% covers the average for most people.

leddy · 18th March 2008

You can try offering the first buyer a few bucks to walk away. Maybe they would walk for $1000 or so, assuming the seller agrees.

Led · 19th March 2008

Houses are like taxis, if you miss one another will be along in a few minutes. I missed out on like 5 properties I wanted before I got my place.
It's tough because you get so emotionally involved and when you decide it is 'the one' you feel like there's no other property that would suit you as well. But they are everywhere, especially with what your market in the US is doing. I reckon it's actually a blessing in disguise. Hang out a little while and there should be some real bargains to be had over there in the short to near term. And you'd probably save enough on the deal to build a studio out the back exactly the way you want it anyway.

17th March 2008	#1
reflexon Gear addict Joined: May 2006 Location: Houston, Tx Posts: 330 Thread Starter	Offer rejected on a house Im sooooooooooooooo pissed right now. I submitted an offer on a house on Saturday. They got another offer 3 hrs before mine. Just found out that they accepted the other offer. No counter, no call no nothing. Just looked on a real estate website and the house now says option pending. Called the agent and she spilled the beans. This place had a separate studio in the back that would have been perfect for me and my gear. It was well within my budget. I literally want to punch the computer screen. I was going to submit my offer a day earlier, but I wanted one last piece of advice from my boss(this is going to be my first home purchase). I cannot explain how frustrated I am. I have been looking for the perfect place for my home, gear, dog, and girlfriend for almost a year. I finally found it and its fukking gone. AAAHHHHHHHHHH!!!!! __________________ Paul Cox www.226recordings.com

17th March 2008	#2
zboy2854 Lives for gear Joined: Dec 2003 Location: Ft. Lauderdale, FL Posts: 7,941	Well, unless they've signed a contract you could always see what the accepted offer was and raise it and see if they'll take yours instead. If not, all's not necessarily lost anyway. Just because they accepted the offer from the other buyer does NOT guarantee they will close with that buyer. Especially the way things are right now, the buyer could fail to get the mortgage approved, the inspection could turn up something he/she doesn't like and back out on the contract, etc. There are all sorts of things that can still happen. So if I were you what I would do is this. Make sure the seller knows that you are available and interested if the deal with the other buyer falls through. These things can and do happen more than you might think. And even if you do lose the house, I wouldn't worry too much. The way the housing market is headed, there will be plenty more properties at bargain prices to choose from over the next year or two. __________________ What the wise man does in the beginning, fools do in the end. --Warren Buffett The four most expensive words in the English language are: "This time it's different." --John Marks Templeton

Thread Tools	Search this Thread
Show Printable Version Email this Page	Search this Thread: Advanced Search

Similar Threads
Thread	Thread starter	Forum	Replies	Last Post
My rejected question for Derek & Jeff	6strings	So much gear, so little time!	14	29th November 2007 10:08 AM
H.E.A.R. AND HOUSE EAR INSTITUTE OFFER HEARING HEALTH SERVICES AT SF AES SHOW	The Press Desk at Gearslutz.com	Product Alerts older than 2 months	1	20th September 2006 02:59 PM
If I could only offer you 1 tip...	blayz2002	Rap + Hip Hop engineering & production	15	15th September 2005 07:08 PM

18th March 2008	#8
leddy Gear addict Joined: Jan 2006 Location: Florida Posts: 498	You can try offering the first buyer a few bucks to walk away. Maybe they would walk for $1000 or so, assuming the seller agrees.

19th March 2008	#9
Led Lives for gear Joined: Apr 2006 Location: Melbourne, Australia Posts: 2,728	Houses are like taxis, if you miss one another will be along in a few minutes. I missed out on like 5 properties I wanted before I got my place. It's tough because you get so emotionally involved and when you decide it is 'the one' you feel like there's no other property that would suit you as well. But they are everywhere, especially with what your market in the US is doing. I reckon it's actually a blessing in disguise. Hang out a little while and there should be some real bargains to be had over there in the short to near term. And you'd probably save enough on the deal to build a studio out the back exactly the way you want it anyway.