Stupid Offers Are Driving Real Estate Prices Up



The Surrey real estate market is out of control and it’s much the same across most of Canada. With so much demand from buyers with easy access to cheap lending and a massive lack of properties for those buyers to pick from, almost every transaction we are a part of in 2022 involved the dreaded “bidding war”. This is when there are competing offers from multiple buyers to try and purchase a single listing.

In this video, Surrey REALTOR® Steve Karrasch of Macdonald Realty, discusses what many of those competing offers look like in today’s market. And without trying to be insensitive to anyone having trouble getting into the market, Steve and his partner Chandani both suggest that if some buyers and their agents would just stop making “Stupid Offers” to purchase homes, that the market may stop rising so fast as a result.

The core idea is that a property that receives 3 offers should sell for less than the same property that receives 11 offers. So now that we have tried to not offend everyone (probably with little success), please enjoy the video and comment below with your thoughts on the matter.

#MultipleOffers #SurreyRealEstate #BiddingWar

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The opinions expressed herein are solely that of Steve Karrasch PREC, not Macdonald Realty or the FVREB and should not be misconstrued as advice or the basis of an agency relationship whatsoever. Please consult your professional advisor prior to taking action on any decisions relating to the matters discussed in these videos. This communication is not intended to cause or induce breach of an existing agency agreement.

11 comments

  1. I agree with what you're saying. I was actually lucky to close on a property this month in Port Coquitlam. The house had 7 offers, and even though ours wasn't the highest priced, we had no subjects AND we had the deposit cheque in hand for them. So we won out because of that.

    I also didn't bother to offer on houses and just "give it a try" since in this market, almost offers with ANY subjects aren't even considered it seems.

  2. My husband and I bid on a house about 1.5 hours outside of toronto that went for double the asking price ($300 was asking, $600k was accepted) and 32 offers. So removing the "stupid offers" would have made zero difference. Having 1 less offer in a scenario with 10+ other "good" offers will not decrease the price that the house goes for, because people are generally going in high to begin with. It's not like an auction on ebay where everyone is bidding $10 dollars over the last offer and it's ratcheted up from there.
    I will say that it's a waste of time though, for the buyer, the seller and all realtors involved, and emotionally and mentally draining for the buyer.

  3. I am in the US and when I put an offer the agent told me that we can put $10k higher than the other highest offers up to the price ceiling I can afford or feels comfortable. Is there something like that in Canada??

  4. I'm calling a bust in 2023/2024. BC has been drunk on real estate gains for over 20 years. All the signs show a massive bubble, especially in BC and Ontario.

    Here are the 2021 average salary by location: Alberta – $61,865 (an increase of 3.8% ) British Columbia – $53,416 (an increase of 5.6% )

    Why is a province that is consistently behind the average national salary have a housing market that is 30% more? Because it has slightly better weather? 🤣
    The average BC box is a sh.t hole compared to what is built in Calgary and Edmonton. The price people are paying then is 100% land value.

    Chilliwack should not be even close to the price of Abbotsford, Mission, or Maple Ridge, but the prices have equalized across the Fraser Valley…it makes zero sense. 🤯

    This is pure speculation, money laundering, cheap credit, over leveraging, and down right mortgage fraud. It's unsustainable, and I'm recommending all my buyers and first-time buyers to wait. Unless you have a house and are trading one-for-one, do not touch this dumpster fire of a market with a 10-foot pole.

    *slight edit on wording* (poor typing from fat fingers on my phone) 😉

  5. As a real estate agent I agree with you about the "Stupid" offers, but its also a learning experience for some buyers. I've found that there are two types of buyers right now. There are those who listen to their realtors advice and do their own research to understand how competitive it is…. then there are those who just think the realtor is wanting to raise their commission by getting them to bid up. The latter are usually the people who just are unplugged from the current economics of the world.

    I typically will give a buyer 2-3 times to place a non-competitive offer. Each time before, during and after I explain that the offer we are submitting has basically no chance to compete against other serious buyers. I also explain what it takes to compete right now as well as provide stats to back it. Some buyers just don't listen. If they aren't will to adjust and compete to actually win a home. I kindly let them know they should seek another agent and offer a recommendation of agents I know who would like to still work with them (usually new agents who just want a buyer and the experience).

  6. I respect the real estate knowledge you have. I have to say I really disagree with you on this video.
    Are you suggesting that real estate prices rise because out of the person making an offer closer to asking price, requesting reasonable conditions, whose offer was not accepted rather than the exuberant buyer who waives all conditions, offers way over asking and whose offer was accepted, the first is the one to blame for the benchmark price going up?
    I agree that someone should be better educated about current market conditions if they are serious about the property, perhaps I'm misunderstanding the point of your video

  7. Thank you for your videos. We were fortunate enough to buy rental condo last month but I fill sorry for my 16 years old daughter who most likely will never be the owner..
    I have to mention we sold our property in Surrey and moved to the Vancouver Island. Market here is also crazy… Our realtor is saying that they never had inventory so low…

  8. The market in BC is crazy. We put a offer on a place on Vancouver Island and it got 65 offers. The winner was a investor as the place was on Facebook market place for rent upstairs and the basement suite. So we have put offers on six places and all six have been won by investors as the places all have show up on rental pages. As buyers we are stepping back and holding. As longtime locals with great paying local white collar jobs in government and aerospace. The market is not heathy.

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