When a Seller lists their property for sale they decide (or are coached) about the 2 ways in which their property can be marketed and offers presented.  The standard or more traditional way is to decide the list price, based on a complete Comparative Market Analysis (CMA)and list the property on MLS and offers are presented at anytime. Basically, first come, first serve...

The second, and increasingly popular way, is to determine the price that the property will be listed for on the MLS ( this list price might be considerably less than other recent comparable sales) and for the Seller to look at offers on a particular day.  Usually this day is a week or so from the day the property went up on the Toronto MLS.  The listing will indicate what date offers are being presented and what time Agents should register.  Sounds simple enough...you have a week to arrange for your client to see the property. It's not like it's first come first serve....or is it!!

A bully offer is when a buyer (and their Agent) register an offer before the agreed upon offer date.  They ask the listing agent to present this offer to the Seller now!  (Remember, the Seller had agreed to look at offers on a particular date) The Seller can't just look at this one offer,  they have to change the rules, and look at any and all offers. If they agree to look at this one bully offer, the Listing Agent will get on the phone and call everyone who has shown the unit and let them know that if they were interested in this property, they don't have  that week to decide...they have to make a decision immediately.  If, like me, you advised your client that they didn't have to miss work, or scramble to see this new listing, you thought wrong.

I'm always amazed that Seller's agree to look at a bully offer...after all, they lose the week's worth of showings and the possibility of multiple offers. They look at it because they have either been told the amount and are happy with that, or, like Christmas, they simply can't wait another minute and need to take a peek at their present. Either way, it makes them look bad, and the Agents look bad.

Properties that are listed for  less than market price (historical past sales)  appear as incredible value, and loads and loads of potential Buyers will be drawn in and shown the property.  Agent's and their clients will be waiting in line to see this 'too good to be true listing'.  As an example, there is a 1 bed + den  condo on King St W, which is priced at $289,900. Two weeks ago a similar unit sold for $322,000.  Now, I'm not a rocket scientist, but I figure that the Agent and the Seller for this current listing, are aware of this recent sale and hoping to achieve the same result. And that is preciselywhy they listed it at that lower price...second time lucky?

Now, I have nothing against this marketing strategy....as long as your (Buyer) Agent is on the ball, they should be able to map out the whole thing for you. Unfortunately, if the Buyers budget is say 300k and there are 6 parties trying to buy this 'too good to be true listing' they probably don't stand a chance.  Mind you, if offer day rolls around and there are 2 interested parties they just might get it.

Anyway, the 'offers on' scenario is not going away....at least not anytime soon.  If you are working with a good real estate Agent they will be able to explain how the system works, and more importantly how to play the game so you don't overpay for a property...ever!

I suppose there will always be Bully's, and Seller's who simply can't wait to get to their present's