A greater inventory of homes for sale is translating into an increase in multiple offer situations.  This is usually a trend that is seen in a “seller’s market” where demand out paces supply, but this is not the case in today’s market where foreclosures have created a large supply.  Does this trend signify a bottom point for the market?  Have prices reached a point where great homes are too good to pass up? 

Banks are asking low-ball prices to attract competitive bidding on foreclosed properties, and their strategy appears to be working.  Bidding on foreclosed homes has increased in the last few months in many states.  “If a house is in a good neighborhood, is maintained, and is a good value, it’ll get multiple offers,” says Julie Holt, owner of Anclote Title Services out of Tarpon Springs, Florida. 

Statistics show that 1 in 10 homes will attract multiple offers.  This is significantly better that 1 in 30 last fall.  This fierce competition is driven by prices, which are typically lower than previous years.  In California, the price index is down 39% from just a year ago.  “When you begin to see people willing to fight for a property, that’s a good sign, says Beth Peerce, treasurer of the California Association of Realtors.  “We are beginning to see the beginning of the end of a disaster time.”  Areas that have been hit hard by the economic storm are also beginning to see more offers on lower end homes and homes with a great value.