Contingent offers

By
Real Estate Agent with Troy Real Estate Group

Contingent offers

 

Contingent offers can get tricky to say the least. Traditionally, contingent offers trade or substitute the marketing of one home for the marketing of another, in addition, to not mention loosing a huge amount of negotiating power for the Buyer.  I'll share about one in particular where this was not the case.

 

My clients Bob and Sally Seller wanted to get a new home with a more contemporary floor plan for entertaining etc., open kitchen-family room concept. We went out and looked at what was available and they fell in love with this particular new construction neighborhood and floor plan. Great, I'm excited for them of course... however in the excitement they forgot that they needed to sell their home before being able to buy this new home. Long story short, we wrote the offer contingent upon the sale of their home. I was able to negotiate a good deal and both parties agreed.

 

Now the real work started. Getting their house on the market and sold. We had already spent a good amount of time going over what needed to be done to be competitive and sell their current property. They had it painted, spruced up the yard, and we had it staged to look like a model home. We priced it competitively based on the snapshot of the market, and then went live. Brokers open house, public open houses, HD Video presentations, Facebook pages, syndication to every known real estate web site; we did it all as I usually do. What we did not count on was that the neighbors a few streets over put their nearly identical home on the market just after us. Guess what? They priced it just under ours and low and behold it generated more activity and went under contract before ours. So, then Bob and Sally Seller agreed to lower the price in hopes of picking up the pace on showing activity. Back thorough the gamut of marketing and open houses for me.

 

Finally, we get an offer! Whoohoo, right? Not so much, it's a very low offer and the Buyer was unwilling to come up. Fast forward two months and two low ball offers later. No wait, back up... after the first offer did not come together we talked about pricing again and determined that the market is trending down and to stay ahead of the curve. Instead of just reducing the price of the house I came up with a plan to ask the builder to reduce his price on the new construction home my clients already had under contract. Remember, we have been contingent on buying the replacement home until this one sold.

 

So, back to the negotiating table on the new purchase, I requested that the builder reduce his price on the new construction purchase and then we would reduce the price on the contingent home the same amount to be back in the market and competitive with what else is available. They agreed and back through all of the marketing aspects I went. This was a win for the builder because he could sell his product, it was a win for Bob and Sally because the net lose was ZERO, but the gain was huge. Ok, so now after a month or so and two low ball offers we finally get the property under contract and SOLD.

 

I wanted to share this story so you would better understand the high level of importance in having a good agent and negotiator on your side. Someone who thinks outside the box and can come up with a win-win solution that mutually benefits ALL parties.

 

Call me or e-mail and I will refer you to a great agent like this!

Comments (0)