When you spot a home that sold for more than its asking price, the odds are that the seller contributed to the closing costs. The buyer made an offer, asked the seller to help with closing costs, and then any contributions from the seller were wrapped into the final price.
I’ve been getting questions about that ever since The Observer started running blurbs on home sales years ago.
Actually, as I remember, the first calls were from readers who thought they’d spotted errors. You know how it went: “The house listed for $220,000 and sold for $223,000? You got it backwards!” I checked with pros, who explained how closing help from the seller could make it appear, well, backwards.
Of course, when you spot a home that sold for more than its asking price, you also might be seeing evidence of a bidding war. It might have, indeed, sold for more than the sellers asked.
“We are seeing multiple offers,” said Abigail Jennings, president of Lake Norman Realty. “They are back!”
Multiple offers occur most often in neighborhoods priced under $300,000, she said. “From $150,000 to the high $200,000s. That’s the most popular range.”
Recently I noticed that three out of the four homes listed one morning in our edition of The Observer closed for more than their asking prices. They were in the Lake Norman area, so I called Jennings to ask if that was part of a growing trend. Probably not, she said, just coincidence.
“It happens infrequently,” she said.
Buyers have learned to ask sellers for closing costs. But there are limits on how much a seller can contribute, and lenders can simply say no. They often do, Jennings said.
Then there’s the matter of the appraisal. A house can’t close for a higher price if it won’t appraise for enough. In this tight lending environment, that’s always an issue.
When lenders and appraisers have no objections and sellers agree to contribute, the buyer isn’t the only one who benefits. The rest of us do, too. The house that sells for more than its asking price becomes a “comparable,” and lifts the values of similar nearby homes.
“It helps the next person in the neighborhood,” Jennings said.
Without more research into the specific sales, there’s no way to know why those homes I spotted sold for more than their asking prices. I’d like to know.
Here’s something else I learned when The Observer started running the home sale blurbs: Real estate pros like to know, too. They turn to their computers when they spot unusual sales.
“Definitely,” Jennings said with a laugh. “Always. There is a story there, and it’s good to know the story.”
Special to the Observer: firstname.lastname@example.org
The Charlotte Observer welcomes your comments on news of the day. The more voices engaged in conversation, the better for us all, but do keep it civil. Please refrain from profanity, obscenity, spam, name-calling or attacking others for their views.
Have a news tip? You can send it to a local news editor; email email@example.com to send us your tip - or - consider joining the Public Insight Network and become a source for The Charlotte Observer.Read moreRead less