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The Buyer's in the Market Place and the Agents that don't know how to deal with them.

By
Real Estate Agent with Willems Realtors, Principal Broker

I have a lovely home for sale in Hessville.  It was built in 1964.  It has harwood floors and a finished basement.  I have received 3 offers on the property and two that have been accepted.  One had the financing fall through.  The other one should not have fell through.

The buyer had a home inspection done.  Which is a good idea, all buyers should do it.  I also like that the home inspector tells the buyer about maintenance items that come with home ownership.  Which is also a good thing for first time home buyers to know about.

After the inspection I received a response from the buyer stating that they wanted the following items fixed or replaced or $10,425 off the purchase price.  The items were the hot water heater because it had a recall, electrical issues there were 4 outlets with open grounds, the gutters replaced, the roof replaced, the trim on the house and garage replaced, the driveway and walkways replaced and the crack in the garage foundation replaced.

According to the pages of the home inspection that I received.  The "necessary pages" most of these were maintenance items.  I called the agent asking him since when are trim, gutters, and a non leaking 12 year old roof, driveway and walkway MAJOR DEFECTS.  He told me that the contract says anything that would bring the value of the house down is a major defect.  I next called an inspector that some of my clients have used on their transactions and asked him what he thought of the home inspection response.  He stated just as I suspected the only items that were MAJOR DEFECTS were the recall on the hot water heater and the electrical.  The home inspector asked what the summary page stated.  I told him I did not know since that wasn't one of the "necessary pages" that was attached.

Next consulting with my seller, she agreed  to fix the electrical and the hot water heater.  We responded to the home inspection.  Stating that the seller would fix the electrical and the recall on the hot water heater.  The rest were maintenance items and would not be fixed by the seller.

Of course the buyer rejected the response and wanted their earnest money back.  I wanted to fight this since the buyer agent refused to show us the summary page.  He said that we didn't pay for the inspection so we did not need that page.  My seller signed the mutual release to let it go back on the market.  She was upset that the seller wanted her to fix all those items and get house for less than $100,000

For my own curiosity I called IAR.  I explained to them what had happened and asked what was considered major defects.  Not to my surprise the person I talked to said that the driveway, walkway, gutters, trim and non leaking roof are not major defects.  I did let that agent know what I had found out.

If I ever have an issue like this again now I can back it up.  It just goes to show that agents need to not only educate themselves they need to educate their buyers along the way. 

Show All Comments Sort:
Coleen DeGroff
Coldwell Banker M.M. Parrish Realtors - Gainesville, FL
Haile Plantation Real Estate - Gainesville FL

Hi Ronda,

Was there a "get out" clause in the contract for the buyers? Because if there is, the buyers could get out of the deal for any reason at all during the inspection period.  Seems to me whether or not the repairs were considered maintenance or defect issues is beside the point. Buyers were using inspection results as a second round of negotiations and basically were just looking for sellers to reduce the price of their home by another 10 grand.

 

And, unless your sellers are in a robust market where their home is the only game in town, it would behoove them to keep the buyers that they have and work to come up with a solution acceptable to all parties. From the sound of it another price reduction was not acceptable to the seller and they decided that it would be worth it to play hardball with the buyer, in essence just challenging them to walk.

Which they did.

It is not pretty out there for sellers right now, and buyers know it.  If sellers want to wait to get what they consider to be a fair price for their home, they could be waiting a long time.....I tell my sellers that they are going to take a beating....it's just a matter of how much of a beating they are going to take.

To me the selling of a house is all about timeline and motivation.....have your sellers bought a property somewhere else? Do they need to move because of job relocation?  How long do they have to wait for the highest and best offer?  If they are on a short timeline, they are going to take (or should be willing to take) a bigger beating than if they are on a long timeline and they don't mind paying the carrying costs (mortgage, taxes, upkeep, etc) until the right buyer with the right offer comes along.

For sellers, it's all about playing the odds....and frankly the odds suck for them right now.

 

Sorry things didn't work out.....I've got my fingers crossed they get another offer soon!

 

 

May 22, 2009 03:30 AM
Ronda Myers-Waters
Willems Realtors, Principal Broker - Chesterton, IN

According to the buyer agent.  The buyers' son is a contractor.  Therefore most of the things that the buyer wanted fix would only cost her the materials to have done.  The buyer was looking to get REO price for a house that was in much better shape than the REOs in the market where she is looking.  Since she was going FHA she couldn't buy an REO from the bank she had to low ball the seller.

Good new though.  I have two second showing on Tuesday.

May 23, 2009 10:08 AM
Coleen DeGroff
Coldwell Banker M.M. Parrish Realtors - Gainesville, FL
Haile Plantation Real Estate - Gainesville FL

Good for you Ronda! I've got my fingers crossed!!

May 26, 2009 04:05 AM
Steve Dalton
219-465-8352 - Valparaiso, IN
Northwest Indiana Home Builder

Ronda, I'm checking into AR today to get caught up on who's doing what in NW Indiana.  Are you still using this blog quite a bit, or have an outside one that you use more? 

 

 

Jul 03, 2009 12:38 AM
Valarie Kubacki
Prime Real Estate - Valparaiso, IN
Broker Associate, CDPE - 5Star

@Coleen I disagree!  I have had a buyer tell me that the agent told them don't worry when the inspection comes back we will get them to knock off another couple thousand.

 

I actually had an inspector write down as a defect wood floors have nicks really no kidding on a 1920 original hardwood floor home.

Jan 28, 2011 01:40 AM
Mary Hillerman
Crye-Leike Realtors® - Bentonville, AR

Hi Rhonda, I hope things are going well for you in real estate! Have a great summer and don't forget to come back and play in the Rain!

 

Jul 06, 2012 04:52 AM