Enigma in Real Estate

My fiance and I have been renting an apartment in a nice beach town for the past fours years. We have been afraid to actually do the math, and find out just how much money we have "wasted". Obviously, when buying a home, you are earning equity -- while when renting -- the money is simply gone forever. Regrettably, we have recently realized that we have wasted well over $50,000 during this 4 year span.

Because we live in a vacation community next to the ocean, the prices of homes have soared. In fact, most of the homes here are not occupied by the homeowners, they are rented on a weekly basis to vacationers from all over. The average weekly rental during peak season is around $4,000 per week. This makes the limited amount of homes here not only very expensive, but also targets for investment groups.

These two factors have made buying our dream home next to impossible. The realty companies and these investment groups work together for mutual benefit. The realtors typically have "first dibs" on a property as soon as it goes onto the market. When they recognize properties which are on sale for a low price, they either purchase it themselves to flip for a higher price, keep them as a rental investment, or else pass the information to the investment groups for a price.

Now, keep in mind -- they are working with the seller, lender, and buyers -- therefore they know who has bid what.

We have learned this the hard way, by watching the market for sales and/or foreclosures -- and watching them be sold before we can even get a chance to look at it. It is not uncommon to see the same home on sale for $100k extra by the end of the same week.

With the Enigma secret contracts, we would at least have a reasonable opportunity of acquiring our dream home. Our bid would have a fighting chance without someone on the inside informing the investment group to bid higher, to keep stealing our dreams out from under us. Also, Enigma would also be beneficial to the seller, on the same token. Some buyers who might be willing to pay more than the asking price without knowing what it is. Additionally, it is not uncommon to see bids come in higher than the asking price after the investment group learns of the home buyers bid. Ultimately, the value of anything is the price that others are willing to pay.

Secret contracts add a layer of checks and balances to the equation -- it would keep the "pigs from getting fatter", while allowing the baby pig a chance at an occasional meal. 

Buying a home is the biggest purchase many of us will ever make in our lives. When purchasing anything, it is important to feel like you have got your hard-earned money's worth. When making the biggest purchase of your life, it is extremely crucial.

Keep in mind, this is just one example. This similar type of scenario is occurring in every industry and every country. Taxpayer dollars are being wasted on undercut bids to build our streets, provide our security, and provide for tomorrow. Lets make our money count!