The first time Jeff Reilly lost a bidding war, he was trying to buy a duplex east of the H Street corridor in the District. He had a $50,000 escalation clause, to $370,000, and was beaten by a $380,000 cash offer.
Reilly, 29, did not have his heart set on the purchase. He was planning to use it as an investment property and continue to rent in Alexandria.
But once he got engaged to Charlotte Perpall, 29, in May, they switched gears, and decided to buy a house they could live in while Reilly fixed it up.
The next two months were so full of house tours, bidding wars and sellers who accepted no bid at all that the couple, now married, can hardly remember which happened when.
They think they bid on six other houses they didn't close on. Or was it five?
Noel Sesay, an agent with One Real Estate in Washington, represented them for most of that time. He said about 75 percent of the bids he submits are going up against other buyers.
The database of sales in the region does not track sales for which there were multiple bids, so there's no way to accurately say how often it's happening in any jurisdiction.
Ben Stern, a real estate agent who mostly represents buyers in the District for Buyer's Edge, paused for a long time when asked how often he had a buyer who was not competing with simultaneous offers. He guessed: once a year?
The problem happens because too many people are chasing too little inventory, especially across the $350,000-to-$700,000 price range of the rowhouses and single-family homes in the District and Takoma Park in Montgomery County.
"Everything does seem to be faster," said Dan Metcalf, a real estate agent with the Finn Family group in Takoma Park. Metcalf mostly represents sellers in Takoma Park, and he said commonly they request bids Tuesday after the first weekend on the market.
Perpall and Reilly were up for making decisions quickly.
Their next attempt was to buy a Craftsman house on a half-acre in Woodridge, in Northeast Washington, east of Brookland and near Mount Rainer in Prince George's County.
"The bones of the house were beautiful," Reilly said. But even though their agent found the owner a new place to move to, as requested, the would-be seller ultimately stayed put.
Next came the house they call the "pee house."
"You walk in the house, you get smacked in the face with the stench of urine," Reilly said. It went for more than $500,000, and the couple's bid had been at asking, in the mid-$400,000s.
The next time they didn't have the highest offer in a bidding war was near the Rhode Island Avenue Metro, one Perpall called "the chicken house," because the neighbors had chickens in the back yard.
That was the highest bid they'd made so far, with escalation to $580,000, even though, in retrospect, Reilly's not even sure if it could have passed inspection to qualify for a VA loan.
"You were pretty demoralized after the chicken house," Reilly said to his wife. She agreed. "I was totally heartbroken."
The couple were renting month-to-month in Alexandria and decided to retreat from the D.C. housing market. Reilly's commute would have been much longer if they had moved to Northeast Washington — he's a contractor at Quantico — but he was willing to do it for the opportunity to make money when they resold the house in a few years.
Reilly grew up tagging along with his dad on construction jobs in New Mexico, so he thought he'd buy in an up-and-coming D.C. neighborhood, do the renovation himself and catch the wave of appreciation.
But, back in Alexandria, they were still outbid on a place near the Braddock Road Metro station in late May. Finally, Reilly found the house they bought July 3, and Sesay wrote the offer on July Fourth. The asking price was $545,000; they offered $535,000, and compromised on $540,000. They were the first offer in, although five more followed on July 5, and they heard one was higher.
"Noel was amazing, how fast he could turn around an offer," Reilly said.
Reilly's fiancee, now wife, didn't even see the house until after they closed. But it wasn't the first time one pulled the trigger when the other just saw photos on the Internet. Reilly had been out of town for work when she entered a bid on one of the D.C. houses.
Besides just deciding to offer more money, buyers adjust to the hyper-competitive market in a number of ways, agents say.
One is lowering their expectations of what they can afford. If they wanted a two-bedroom condo, they'll look at one-bedroom properties. If they wanted a rowhouse that didn't need any work, now they're willing to redo an ugly kitchen. They'll drop off-street parking as a requirement.
But for folks who want a rowhouse, they usually won't downsize to a condo, Stern said. They'll shift to a neighborhood earlier on the gentrification curve instead.
In the District, that generally means moving north or east. Instead of Shaw, Bloomingdale. Instead of Bloomingdale, Eckington. Instead of Eckington, Trinidad. Instead of Petworth, Brightwood.
Stern said it's not as common for someone to start looking in the District but ending up buying in a more affordable suburb such as Mount Rainier, West Hyattsville or Silver Spring.
But Ann Wenzel, 33, and Scott Wallace, 32, changed more than just Zip codes when they repeatedly failed to win bids several months ago.
The couple had been renting a bungalow in Takoma Park for $2,200 a month when they decided in December 2016 to start looking to buy in that city within a mile of Metro — for less than $500,000.
The first bid was on a house in Takoma Park that had gone on the market that month. The sellers had dropped the price about $10,000, which put it below the half-million mark.
They offered the asking price but asked for $5,000 back at closing, and lost out to a buyer who had 20 percent down. They had only a 10 percent down payment. "We didn't know what we were doing," Wenzel said.
Next, they tried a Cape Cod in Silver Spring, about two miles to downtown. They went in asking at $495,000, and asked for $5,000 back because it needed a roof. The successful bidder paid $516,500.
Sesay said it's rare to have a buyer with five or six failed bids, but that winning on the third try is pretty typical.
Ann and Scott did win their third bid, a Brightwood rowhouse for $487,000 that they thought needed $50,000 worth of work.
"We were like, 'Oh, [expletive]," Ann recalled, after learning they were chosen. After inspection, the couple were told it might need $80,000 to $100,000 to put in air conditioning, remodel the kitchen and fix a sagging porch. They backed out.
Their lease was up May 31, and their landlord wasn't willing to go month-to-month, so they were on the verge of giving up. Then a house in Brightwood that had a recently redone Ikea kitchen and had air conditioning came on the market for $458,000. They put in an escalation clause for up to $475,000, and they needed every last dollar of it. There were 11 other offers, but theirs, even with only 3 percent down, was the winner. They learned the kitchen remodel had been done without a permit, so they've picked up some DIY skills and upgraded to safe outlets in the kitchen, put handles in the shower, painted, and patched and smoothed plaster.
Although a lack of shower handles didn't deter these bidders in Brightwood, Metcalf said more buyers should consider more houses that aren't cute. "The market right now is extremely driven by aesthetics," he said.
Metcalf said buyers who are outbid can learn from their mistakes. Don't offer below asking and pair it with an escalation clause past asking. Make your earnest deposit at least 5 percent of the asking price if you are going to be putting that much or more down. More is better. The deposit isn't at risk until after inspection.
And, he said, consider houses that have been sitting on the market for weeks. "If it's over 15 days on the market, no one looks at it," he said. "If it's mispriced, that could be fixed."
Although most said it was exhausting to shop for houses in a market that Stern called "peak craziness," Reilly looks back on the months of frenetic activity with fondness.
"I enjoyed it," he said. "If you're getting beat, you know you're not overpaying."