The Prague story illustrates this eloquently. “Záběhlice seemed good to us, close to the shop, traffic arteries, and yet the street is quiet, on a hill. So we offered 4.9 million crowns, that was our absolute ceiling, “described Práva the father of a family that was interested in the apartment.
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They will wait and raise the price
The broker told them about the higher offer that she would contact them again and that the real estate agency would choose the highest offer when the second round of inspections ended. The family didn’t even count on the purchase and looked around for another apartment when the broker called again in a week and announced that they had finally chosen the family. “There was another applicant who also offered 4.9 million crowns, but he would take out a mortgage, so we preferred clients with cash,” she announced.
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The family had enough funds because of the complicated inheritance, they sold the house near Prague in co-ownership. It must be added, however, that not all sellers prefer buyers with cash. Sometimes, especially at family homes, they don’t rush and wait two or three months before another person can take out a mortgage. But he will pay a higher price than the one who wanted to buy now and for cash.
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The running-in apartment also showed how sharply real estate has become more expensive. When the buyers’ lawyer obtained a purchase contract from the cadastre, he read in it that the real estate company had bought the apartment a million cheaper from insolvency six months ago – for 3.9 million. They just had the apartment painted and had new floors laid, as there was a small fire before. However, these repairs came from the insurance of the previous occupant. It was up to the buyers to repair the toilet and bathroom for another roughly CZK 200,000. And cottages in the mountains or land? Interested parties are bidding half a million or more.
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Today, it is quite common for a real estate agent to point out that in the case of more interested parties, the sale will take place in the form of an auction, for example via the Internet at a distance. Takes the highest bid. But you have to be careful: not everyone who signs up and increases the price has to be a real applicant. As happened at the recent electronic auction of a cottage in Bohemian Switzerland. Two dozen people competed in it, and after half an hour someone started bidding three times as much as necessary. The price was raised by almost a million crowns. In general, according to the GarantovanyNajem.cz server, thirty percent of the properties sold are overpaid, while prices increase by two to six percent of the advertised price.
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Overpayment most often occurs in cases where the property is purchased in the form of auctions or envelope methods, where interested parties offer a one-time maximum amount that they are willing to pay. There has also been a breach of reservation contracts for years. One family recently concluded a reservation contract for a log cabin with meadows and forests by the Svratka River near Polička for 14 million crowns. But suddenly the seller announced that he would return the reservation fee to the buyer and pay them a contractual penalty. The reason: he found a buyer willing to pay 17 million.
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