With the lack of inventory out there buyers have little to choose from and thus are paying premium dollars for the house they want to buy. 99.9% of the time they are paying above asking price. They either are paying out-of-pocket for the difference with the appraisal or working something out in the offer with the sellers. Contingencies are being removed as well.
I have a listing that just sold for 25K over list price and I also just had an offer accepted with a buyer on a home and we just got the offer barely accepted with 25K over.
Below is an article that explains this a bit.
This article is from the Daily Real Estate News…
More Buyers Willing to Make Higher Offers
Home buyers are saying they’re willing to pay more for a residential property due to concerns over low inventory. In the second quarter of 2013, 41 percent of buyers said they’re willing to offer more, up from 34 percent in the first quarter, according to a survey of more than 1,300 home buyers in 22 major markets by the real estate brokerage Redfin.
The number of buyers who say they’re concerned about rising home prices has more than doubled in the past year, according to the survey. Seventy-nine percent of home buyers say they believe prices will increase in the next 12 months—with 23 percent of that group saying by “a lot.”
“Home buyers are accepting the reality of a seller’s market and expressing a willingness to pay more,” according to the brokerage’s survey.