Over the past month I’ve been searching for lower priced homes in the South Bay and Long Beach.  There’s been a strong buyer interest in these properties.  I’ve encountered many properties receiving multiple offers, and lenders are feeling more in control on short sale properties.

On one day in particular I was preparing to write up two offers but before I did I called the listing agents to see if they already had offers.  These properties had only come onto the market a couple days earlier so I was hoping they hadn’t been “discovered” by the area bargain hunters.

No such luck.  The first property had received an astounding 38 offers, including one that was more than 70K over asking price.  The other had a mere 8 offers.

Personally, I’m concerned that the buyers are over reacting to the price upturn and creating a mini-bubble.  Buyers today need to consider what the home will be worth in 2-3 years.

No doubt historically low interest rates combined with buyer incentives from the government are helping.  The problem is what happens when interest rates rise or the buyer assistance programs come to an end.

If you are shopping for an investment property these days you can make it work if you are able to flip it quickly.  Just keep in mind that there is no guarantee that the market will keep getting stronger and those perceived profits could evaporate if you don’t get the property back on the market in a timely manner.