Sep. 25, 2007 - Sellers Should Look Seriously at All Offers

So, your Sarasota real estate agent brought you an offer!  The offer was $45,000 less than your asking price of $250,000.  What do you do? 

Here's what I think.  I think you need to look at the whole picture.  If you've been on the market for awhile and have had little activity and no offers, then you really need to take a hard look at this offer.  If you've been on the market for awhile (over 3 months) and you've had a lot of activity, but no offers, you STILL need to take a hard look at this offer.

Ask yourself these questions:

1.  How would my life change if I took this offer.

2.   Would I be able to purchase another home?

3.   Would I be able to put money in the bank?

4.  Is my quality of life going to change for the better?  i.e., no more yardwork, less worries, freedom to travel, etc

You need to look at all aspects of your offer and not just the price.  Are the buyers strong financially?  How much are they putting in escrow.  I think you need at least 5% in escrow for properties under $300,000 and on more expensive properties, 10% would make a stronger offer.  I've seen offers come in with only 1% or 2% and I always negotiate that up for my sellers.  The reason is, the more a buyer puts in escrow, the less likely he's going to walk away from the deal.

Other things you need to look for...who's paying for the title insurance?  Did you know that is negotiable?  Whoever is paying for the Title Insurance is the one who chooses the closing agent.

Are the buyers requesting any furniture or appliance that you didn't want to give up?  Are they relocating from another town?

Ask your Realtor what the buyer's motivation is?  Did they just get married? Are they getting ready to retire?  Many times, the answers to these questions will help you decide whether to counter offer, or just accept the price as is.

Always remember, once you change anything in an offer, the offer is no longer valid.

Call me any time

Nicki

Aug. 24, 2007 - Letting Buyers in BEFORE You Close...

I recently had a seller who insisted on speaking directly with the buyer about the real estate "deal".  I advised my client that is was not a good practice to create a friendly relationship with the buyer before the closing.  I explained to my seller that she might unknowingly say something that could set the buyer off.  My seller didn't head my advice.

I found out by driving by the house after all inspections, etc were completed that the seller had even gone so far as to allow the buyers to move their items into the house.  When I saw this, I called her and she admitted that she had agreed to allow the buyers to place their furniture in the house before closing.  Once again, I advised her that she would be responsible for any damages and any liability that might occur.  I explained that if for some reason, the property didn't close that there could be a problem getting the buyers to remove their items.  I put this in writing at the advice of a Real Estate attorney.  He told me at this point, I had to just leave it alone and wash my hands of it and hope for the best.

All contingencies, including the financing contingency had been met.  During negotiations, I had insisted that the buyer lay down 5% ($30,000) instead of the $5,000 he proposed.  He agreed.

Closing day came and the buyer walked.  He did not want to close because the deal on HIS house had fallen through.  He gave up his $30,000 deposit.  I gave the entire amount to the Seller although we had agreed (in the listing agreement) to split it 50/50 between broker and seller. The seller agreed to sign a 6-month listing with me.

Since the buyer's stuff was in the garage and in the house, the Seller had to supervise the removal of the items.  She was very upset about this and began speaking to me in an angry tone.  I reminded her that it was NONE of my doing and I vehemently opposed it from the beginning.  She spent 3 days at the house supervising the removal as they were removing items themselves using a van.  Then she spent another 3 days cleaning up their mess.

From now on, when I take a listing, I'm going to have the seller sign an agreement that they will not allow buyers access to their homes before the closing date.  It's heartache for everyone. 

My hope is that everyone who reads this will learn from it.