Odd sales tactic for inflating offer?

[vicarrieous]

I've been perusing these boards to get a feel for what it is like to buy resale. the DVC estimator says that my family of four should buy in about 220 points. Does that seem like a lot for a family of four who vacations only a few times a year. Not always Disney.

Hey Jimmy - You may get more responses if you post this as its own thread. There are a lot of variables here and that discussion maybe wont follow this thread.

 

[mommy2allyandaveri]

I've been perusing these boards to get a feel for what it is like to buy resale. the DVC estimator says that my family of four should buy in about 220 points. Does that seem like a lot for a family of four who vacations only a few times a year. Not always Disney.

I would follow that. I would look at the point chart. What resorts do you think you will want to stay at, what room category and what time of year. That will give you a good idea of how many points is right for you. I think that estimator is too generic.

Some who likes a studio at SSR for a week in Feb, needs very different points than someone who wants a one bedroom for a week in July at BCV.

 

[DougEMG]

Back in the 2010-2012 days I was in bidding wars with other people on contracts. Even knew some of the people and we'd talk about who was bidding on what.

 

[bookwormde]

Hey All,

My name is Marissa I am the sales and marketing director at the DVC Resale Market.

I totally understand the frustration and as a buyer if I were in your shoes I would be wondering the same thing!

I wanted to share some insight on the real estate and legal side of things so you have an understanding of what happens in these scenarios. When we have multiple offers and there is not an accepted offer from the seller then we have a legal obligation to present all offers to the seller.

In order to make things fair for all parties involved we give all buyers the chance to present their highest and best offer by a specific deadline, and whoever has the highest offer will move forward in negotiations with the seller. This way we can accomplish our legal obligation to the seller but also keep things as fair as possible for all buyers involved.

What is actually illegal is creating an auction environment or a "bidding war" where we disclose to one buyer that we currently have an offer of xxx and see if they will bid higher, then ping ponging back and forth to each buyer. This is an illegal inflation sales tactic and not something we do in our business. We simply offer all buyers the chance to provide their highest and best offer.

In response to 'the listing was still avail the next day or a few days later' - that was most certainly a case where a buyer's offer was indeed the 'highest & best' offer but at some point was simply unable to complete and finalize the transaction just because we have buyers provide their highest and best offers does not mean that the seller is going to accept the highest offer that comes in, they may decide to keep their listing on the market in order to get a more desirable offer.

On the flip side there have been comments about certain brokers only presenting one offer at a time to a seller. Keep in mind if a broker refuses to give an offer to a seller on a listing that does not currently have an offer accepted this is illegal. Brokers who are not willing to let sellers entertain other offers have a high risk of losing their license as this is not a legal real estate practice. Nor is this ethical as a buyer or seller you want the best opportunity possible, as a seller you want the chance to review all offers if your contract is still for sale. As a buyer you want the chance for your offer to be presented if there is an available listing you do not want to be turned away simply because there is another offer and the broker is not willing to legally present your offer.

As a transaction broker we need to ensure that we are fair to all parties as we are providing a service to both the buyer and the seller.

If anyone has further questions on this discussion I am happy to assist feel free to comment back or you can reach me directly at marissa@dvcresalemarket.com

Thanks,

That is a great explanation of what a broker may not initiate as well as the responsibility to present all offers that have not been precluded by prior direction of the seller

The important thing to remember is that the seller can make decisions that if initiated by the seller are perfectly legal, such as rejecting the lowest offer but indicating a higher offer would be considered. and then moving on to the next lowest offer and so forth. Of curse there is always a risk that all offers will be withdrawn no mater what methodology is used

The highest and best process can can yield good results and requires the least effort for the broker, but is not always the best negotiating strategy for the seller

 

[DVCSunDevil]

Side question, is there a standard expiration time for offers? Do sellers have unlimited amount of time to consider/wait for other offers if one is submitted? Is there a general guideline for example "offer expires in x-amount of hours/days". As a buy should you be including this in your offer? I only have experience one with placing an offer and no such language was present nor spot to insert this. Thoughts?

You can absolutely give a timeline for your offer. Doing this in the world of DVC resale makes a lot of sense, as well. There are lots of other contracts out there that you might be interested in, but you don’t want to put an offer in on all of them to be respectful of those sellers. I have heard of some people putting multiple offers out on contracts at the same time, and then withdrawing their offers once one of the seller accepts their offer. IMO, that is not very scrupulous. The alternative is to make an offer with the stipulation that it expires in 24 hours. This ensures a timely answer, which will free you up to make your next offer if it is rejected.

I don’t think there is a hard and fast rule as to how long the seller has to respond to an offer. I don’t know if it is a huge problem for DVC, however. For DVC resales it sounds like most sellers respond fairly quickly to an offer. I guess some sellers may drag their feet and wait to see if other offers come in, so putting a time stipulation on it can be a good idea.

 

[DVCSunDevil]

Thank you for your detailed response.

I appreciate the detail and based on what you are communicating I totally understand where you are coming from.

It appears there may be something we can use as a coaching opportunity with our team or additional training for that specific agent so if you are able to send me more details please email me at marissa@dvcresalemarket.com. I want to ensure that you are having an excellent experience with your add on and with our company through the offer process so I really do want to thank you for your feedback.

There are times where certain sellers will have a bottom line number where they will only entertain offers above a certain price per point and ask us as the agent to decline all offers lower than that so this may be one of the scenarios that was not clearly communicated by our agent.

As for the highest and best offer since we have 13 agents that work here there are times where one agent has a buyer with an offer and another agent has a buyer with a different offer and those agents need to set up with their clients a highest and best offer time. In this scenario it is very likely that the other agent has no idea what the other offers is as they are not working with that buyer.

I think one thing to point out is the current market not only are we seeing this in traditional real estate but also in DVC. There are times where we have 500+ listings on the site with 70-80 offers a week and in those times having a highest and best scenario is quite rare. Currently have have around 280 listings on the site with around 130 offers coming in a week so the chances of having more than one buyer bidding on the same contract is quite normal right now. Couple that with Disney getting much more aggressive in their buy backs as of late makes for a very hot market so something to keep in mind if you are being told that there are multiple offers its very likely at the moment.

Thanks again!

Thank you, Marissa, for both of your comments on this thread. They were very in-depth and informative. In all fairness, however, neither comment gives a valid reason as to what the OP experienced in their situation. In that scenario, it seems the agent was trying to get them to up their offer. In fact, the agent even disclosed the amount offered by another buyer which goes against what you wrote in this comment:
“What is actually illegal is creating an auction environment or a "bidding war" where we disclose to one buyer that we currently have an offer of xxx and see if they will bid higher, then ping ponging back and forth to each buyer. This is an illegal inflation sales tactic and not something we do in our business. We simply offer all buyers the chance to provide their highest and best offer.”
I totally get that confusion and miscommunication happens, but the agent disclosing what another buyer offered is kind of hard to be explained by miscommunication. That is precisely how someone would attempt to start a bidding war.

PS: please don’t take my comment as argumentative, I’m just going by what was described in the comments on this thread.

 

[wishicouldgomoreofte]

I just had an offer accepted through a broker and it passed ROFR today but I thought the process was interesting in a good way.

I saw a AKL listed at $114per point, I offered $106. (this was a Friday going into holiday weekend - MLK day). I received no feedback Friday, so i called broker on Saturday to discuss, she told me that I likely would not hear back until Monday or Tuesday because of holiday on Monday. I told her I was concerned that the party may receive a higher offer and mine would be ignored and basically sitting around for 4 days.

Broker told me that they only show one offer to seller at a time, and no other offers would be presented until either we had agreed to terms or stopped making counter offers.

They counter-offered me at 109 on Tuesday, broker told me that they had other offers from buyers higher than mine, but they had not been presented to seller. I then accepted their counter-offer.

I am really not sure if this is standard or not. it has been 15 years since i purchased my last contract. But i really liked the way i was treated and would diffeerently use this broker again....so my point is some brokers are very good and professional.

What broker was that?

 

[Red Dog Run]

I've had a realtor accidentally work it out in my favor. I emailed an offer for the asking price on an OKW. I got impatient after only 2 minutes, (newbie), I called asap. When I asked how firm the seller is on the price, he stated that the seller would only go down to $2 a pt if I was interested. I said, yes, and completed the information online. Before I could get off the phone, the realtor asked if I had just put in a bid for the asking price. I said yes, but you said the seller would take $2 less a point. I bet it wasn't supposed to go like that. That was my first contract. I bought 3 more. The process was fine, though. NO issues.

 

[wishicouldgomoreofte]

This is great for the buyer that follows the site and instantly offers. But its bad for the buyers willing to pay more. This is also bad for the seller since they dont get the highest price.

I had made an offer on a VGF with a broker that allow each buyer/seller to negotiate ( Im guessing its the same agent as fordchevyguy since I have dealt with many sites but only one of them does this). The contract was the exact UY I wanted, fully loaded with banked points, and was fairly priced. I was willing to go to their asking price, but I was never given an option to give my offer. The seller ultimately accepted over $15 dollars per point lower than what I was willing to pay. If I ever sell, I would never list with this agent. Its a larger agent and I am surprised more people dont realize how they sell contracts because if they did, I doubt they would list with this agent.

Please tell us who this is.

 

[pkrieger2287]

Thank you, Marissa, for both of your comments on this thread. They were very in-depth and informative. In all fairness, however, neither comment gives a valid reason as to what the OP experienced in their situation. In that scenario, it seems the agent was trying to get them to up their offer. In fact, the agent even disclosed the amount offered by another buyer which goes against what you wrote in this comment:
“What is actually illegal is creating an auction environment or a "bidding war" where we disclose to one buyer that we currently have an offer of xxx and see if they will bid higher, then ping ponging back and forth to each buyer. This is an illegal inflation sales tactic and not something we do in our business. We simply offer all buyers the chance to provide their highest and best offer.”
I totally get that confusion and miscommunication happens, but the agent disclosing what another buyer offered is kind of hard to be explained by miscommunication. That is precisely how someone would attempt to start a bidding war.

PS: please don’t take my comment as argumentative, I’m just going by what was described in the comments on this thread.

I think she properly addressed this by asking the OP to email her the details of the situation. Something may have been stated or said that needs to be addressed internally and not within the eyes of a public forum.

 

[RedFive]

We purchased resale back in 2015 and addonitis has finally struck. We aren't in a rush at all and are on the hunt for a good/perfect deal for us. We are more thinking ahead a few years to when we will have to travel at higher point times than we do now. So we decided to add on economically by purchasing at SSR.
Anyway, to my question...has anyone ever encountered a broker or brokerage firm where when you make an offer, you are informed that there is a "bidding war" or the sellers are talking to another interested party? I put in two different offers on https://www.dvcresalemarket.com, and the first, I was told there was a bidding war and to submit my best offer for the seller to evaluate by the next morning. I found it a bit odd and wasn't interested at all in getting in a bidding war so I said our offer was our offer. Today, I made a different offer and was told by the same broker that the seller had another interested buyer at X price point. I find it a bit odd and surprising because these are not newly posted contracts, are not at a low inventory resort and not small point contracts. It's left a bit of a bad taste in my mouth for working with this company so I was curious if anyone else has experienced this type of sales tactic or if I'm reading too much into it. Both of these contracts are still listed as available on the site.
I should also mention that the offers I submitted were in line with what similar contracts have been going for. Perhaps on the lower/average side, but with the assumption the seller would counter.

My personal opinion is if you dont want a "bidding war" in a marketplace, offer the asking price, right? Otherwise, you're going to be haggling either way. I guess it just sounds like marketplace behavior to me, but the resale marketplace is new for me, so maybe I'm wrong.

 

[bks9581]

My personal opinion is if you dont want a "bidding war" in a marketplace, offer the asking price, right? Otherwise, you're going to be haggling either way.

LOL...really? Do you also walk into a car dealership and pay the sticker price? Also, I think you missed my point entirely. I'm not complaining about bidding wars or "haggling." I'm suspicious of the circumstances surrounding my offers. If this was something I felt was worth getting into a bidding war over or raising my price to get to make sure I got what I wanted, I would do that. A marketplace lets two parties decide what they are willing to pay and what they are willing to take and sometimes there is back and forth to get to an agreement price. In my opinion though, an agent should never be misrepresenting the situation for the parties involved.

 

[RedFive]

LOL...really? Do you also walk into a car dealership and pay the sticker price? Also, I think you missed my point entirely. I'm not complaining about bidding wars or "haggling." I'm suspicious of the circumstances surrounding my offers. If this was something I felt was worth getting into a bidding war over or raising my price to get to make sure I got what I wanted, I would do that. A marketplace lets two parties decide what they are willing to pay and what they are willing to take and sometimes there is back and forth to get to an agreement price. In my opinion though, an agent should never be misrepresenting the situation for the parties involved.

Yeah. The Resale marketplace isn't a car dealership, though; It's free market. No different than multiple parties bidding on a car being sold by an independent seller. And I think it's unfair to accuse the broker of misrepresenting the situation without evidence. The broker is just as motivated to sell the contract as you are to buy it.

 

[we"reofftoneverland]

I know they sponsor the site, but I would stay away from that broker. We had a similar experience and the contract sat for another 6 months on their site.

 

[DVCSunDevil]

I think she properly addressed this by asking the OP to email her the details of the situation. Something may have been stated or said that needs to be addressed internally and not within the eyes of a public forum.

I completely agree that she should have commented for the OP to contact her to discuss this offline. IMO, that should have been the totality of her comment (“Thank you for bringing this issue to my attention. Please contact me to discuss.”). Instead, she had a pretty in depth comment tying to explain how things work and validate the situation. In that comment she actually ended up saying that what the OP had experienced was illegal. I was just bringing that to her attention. None of us have all the details, but the details as they were presented by the OP would constitute something illegal by the agent based on her explanation.

 

[bks9581]

Yeah. The Resale marketplace isn't a car dealership, though; It's free market. No different than multiple parties bidding on a car being sold by an independent seller. And I think it's unfair to accuse the broker of misrepresenting the situation without evidence. The broker is just as motivated to sell the contract as you are to buy it.

No different than multiple parties bidding on a car being sold by an independent seller

I agree with you. And if I bid on a car that I had seen sitting on the lot for weeks and they told me there was a bidding war to and bring my best offer, I would think odd, but ok. Now let's say the next day I make an offer on another car I have seen sitting on the lot for weeks and they tell me there is another interested buyer. At that point I start to get a little suspicious. Enough to take my business elsewhere since I've seen that type of car on many lots.

And I think it's unfair to accuse the broker of misrepresenting the situation without evidence.

Please point out where I have accused anyone of anything without evidence. I stated my experience and asked if that was normal or if anyone else had similar experiences. All I have said all along is how this experience made me feel.

 

[RedFive]

Please point out where I have accused anyone of anything without evidence. I stated my experience and asked if that was normal or if anyone else had similar experiences. All I have said all along is how this experience made me feel.

In my opinion though, an agent should never be misrepresenting the situation for the parties involved.

 

[bks9581]

Please post my full quote for context. I was speaking in general about the process of buying and selling in a marketplace.

I'm not complaining about bidding wars or "haggling." I'm suspicious of the circumstances surrounding my offers. If this was something I felt was worth getting into a bidding war over or raising my price to get to make sure I got what I wanted, I would do that. A marketplace lets two parties decide what they are willing to pay and what they are willing to take and sometimes there is back and forth to get to an agreement price. In my opinion though, an agent should never be misrepresenting the situation for the parties involved.

"AN agent" not "THIS agent"

And people can read through this thread and decide for themselves how they feel about my experience.

 

[DVCSunDevil]

The broker is just as motivated to sell the contract as you are to buy it.

And the fact the broker makes commissions on the sale motivates them to seek a higher price point. Once they have one offer in hand that would be accepted by the seller, the broker would benefit by having another offer come in. That would enable them to try and create a bidding war, which Marissa confirmed is illegal.

I have worked in sales (medical device) for the majority of my professional career. An old/true saying is that compensation drives behavior/activities. In my world where I have many products in my “bag”, if management wants the salesforce to focus on one product they will give higher commission/compensation for that product. In the world of brokers, they make a commission on the sale so there is obvious incentive to adopt behaviors that would drive the price up...like sharing offers from other buyers with prospective buyers to drive their offer up. Or making it sound like there are other higher offers on the table when there really aren’t.

I am not saying that is exactly what happened in this case, I am just someone commenting on this thread like everybody else. But to think it doesn’t happen would be foolish. The one particular situation as described by the OP does not sound kosher.

 

[RedFive]

And the fact the broker makes commissions on the sale motivates them to seek a higher price point. Once they have one offer in hand that would be accepted by the seller, the broker would benefit by having another offer come in. That would enable them to try and create a bidding war, which Marissa confirmed is illegal.

I have worked in sales (medical device) for the majority of my professional career. An old/true saying is that compensation drives behavior/activities. In my world where I have many products in my “bag”, if management wants the salesforce to focus on one product they will give higher commission/compensation for that product. In the world of brokers, they make a commission on the sale so there is obvious incentive to adopt behaviors that would drive the price up...like sharing offers from other buyers with prospective buyers to drive their offer up.

Again.. this situation is all speculation. Please don't take my comments as argumentative here, but a lot is being insinuated in this thread.