Special offer

When a house is oh so right, but really oh so wrong.

By
Real Estate Agent with Compass

Recently, a seller/buyer of mine backed out of the perfect home for her.   And it was 100% the right thing to do.  The condo was a good price, great layout, wonderful condition and location, but it came with many obstacles, and finally one too many to make it a viable home.  We had seen dozens of other homes and this one really suited her needs and wants perfectly.  Here's how we tried to make it work and why we eventually bailed.

Obstacle #1:

It was nearly impossible to show.  The condo was tenant occupied and they wanted exactly 24 hours notice.  I tried giving 48 plus, but that was not good enough.  I had to call exactly the day before/time before I wanted to show.  I found this to be difficult, as my client was not sure when she could go.  So I tried telling the agent on Monday that it would be "either Thursday or Friday" and I would let her know exactly when closer to that time.  When I finally found out my client's schedule, it was a wee bit less than a whole 24 hours, and we were rejected for the showing, so we then had to wait about 3-4 days, which was also extremely hard to pin down with the agent.  On Friday, I said, "can we go next Tuesday at 2?" and she said "call the day before."  I said, "but I have you on the phone right now, can't we just set this up?"  Finally, we made an appointment.   Sheesh.  It just shouldn't be this hard!

Obstacle #2:

The tenants had to stay in the house until the end of Feburary.  In spite of their complete PIA showing requirements, the agent insisted that they were dream tenants and this would be an easy experience for my buyer.   It was a big burden for my client to find temporary housing, but since the actual home was perfect, she tried to make it work, with my encouragement, afterall, nothing in life is perfect, right?  So we agreed to let the tenants stay and rushed to find a sublet or short term rental to bridge the gap between her house closing and the end of February 11.

Obstacle #3:

We show up for the home inspection, and the agent apologises profusely for the mistake she made in the condo fee published in the MLS.  It was not $465/ month, it was actually $625/month.  Oh and this does not include electricity.  So factor in a high of about $120 more a month when the heat pump is really cranked.  This was quite a bit more than a small typo or forgivable mistake.  That equates to about $35K in value if it were a mortgage payment.  We talked about ways to make it work, asked the lender if the seller could buy down the rate significantly, talked about reducing the price.  My client was shocked and disappointed, but wanted to try to make it work.  Meanwhile...

Obstacle #4, straw that broke the camel's back:

Incomplete condo docs!  I don't know why property management companies do not take putting together the resale package more seriously than they do.  This building delivered in 2006, all sellers are underwater value wise if not mortage wise, and they can't give us current year financials?  With an enormous condo fee like that, where is their money going?  My client called with questions and was told to email.  She and I both emailed for a current year statement, questions about a budget shortfall in 2008, asked for meeting minutes (there were NONE), and clarification on a $25 investor fee that was listed as tied to this unit.  We NEVER RECEIVED AN ANSWER.

Well that was it, she, and I were both done. I could not in good faith continue to encourage her to look beyond the massive warts and pimples associated with this place.   Even if we could have come to an agreement to make it work financially with the seller, there were just too many massive red flags.   I do feel sorry for the seller, they were set to sell for $200K less than they paid in 2006, had been on the market for months, and these were the best terms they could come up with to sell?  This is a perfect anatomy of how NOT to sell a house.

Comments (26)

Carol Costanzo
Montague Miller and Company - Charlottesville, VA
GRI, SFR

Coral, I think I showed that place once, we were tied up in traffic and were 4 minutes late for our appointment. Yes, that is right... 4 minutes on a reserved hour appointment of 56 minutes remaining. The tenant refused to give us access because we were tardy. I agree with Kathryn it is the seller's agent's fault pure and simple.

Dec 14, 2010 08:32 AM
Jeremy Gryvatz
RealWorks Residential Brokerage - Manalapan, NJ

You ran in to the problem regarding the associations financials because you are clearly a top quality agent. 9 out of 10 agents wouldnt be covering that basic part of their clients needs.

Dec 14, 2010 09:16 AM
Karen Feltman
Cedar Rapids/Iowa City, IA KW Legacy Group - Cedar Rapids, IA
Relocation Specialist in Cedar Rapids, Iowa

Wow!  That sounds like one headache after another!  I think that you made the right decision in the end.  Guess the listing agent will learn to get all of that information upfront if and when another offer comes in!  Good luck to your buyer!

Dec 14, 2010 10:11 AM
Eve Alexander
Buyers Broker of Florida - Tampa, FL
Exclusively Representing ONLY Tampa Home Buyers

I ask for the condo docs, Q and A, current rules and rega and financials as part of the contract for the seller to provide....because the buyer or buyers agent has no "standing" with the HOA and they are not obligated to respond.

They are however obligated to respond to the owner of the unit.

The listing agent should have been on top of all the fees and Hoa docs and the seller needed to have a chat with the tenants...

Geez, no wonder some good homes never sell.

Eve in Orlando

Dec 14, 2010 11:54 AM
Coral Gundlach
Compass - Arlington, VA
Real Lives. Not Just Real Estate.

Wow!  Thanks for the great responses. 

Kathryn, I know right?  I asked her time and time again why these tenants had so much authority over her.  Never could get an answer.

Melissa, exactly - one hoop too many.

Glenn, quite a few because of the drastic decline in market value and in lieu of selling at a loss or short selling, they rented them out.

Carol, really?  Some people.

Jeremy, aw thanks.  We do have a lot of great agents around here, fortunately!

Karen, yes I am sure she will, she felt awful about the mistake.

Buyers Broker,  In Virginia, sellers by law have to provide an updated copy of the condos resale docs, the seller pays for it and usually the seller's agent orders them.    It is standard in our contract, no need to ask for it.  Our buyers have a 3 day right to rescind after receipt of the condo docs.

Dec 14, 2010 12:12 PM
Leslie Ebersole
Swanepoel T3 Group - Saint Charles, IL
I help brokers build businesses they love.

Well, it really wasn't the perfect home because it wasn't buyable. It may have been desirable from a price, layout and location standpoint, but not buyable.

You seem to have gotten into an unmanagebale situation from a buyer's standpoint. You're lucky to be out.

Hopefully the seller realizes they need a much, much better agent. I don't know about VA, but here in IL the seller is responsible for the data in the mls and apparently the seller was responsible for producing docs. Not sure they were entirely on board with selling at a $200,000 loss.

And the tenants? They were NOT dream tenants, and I can't imagine going forward with a deal without a written agreement to vacate before the closing. Why would they leave their perfect situation?

Good luck -- your buyer will get the next one!

Dec 14, 2010 12:50 PM
Ryan Case
SCA Real Estate - Anaheim, CA
877-828-0710

I hate it when a tenant has to stay after the sale, makes an owner user sale difficult!

Dec 14, 2010 01:17 PM
Coral Gundlach
Compass - Arlington, VA
Real Lives. Not Just Real Estate.

Leslie, The agent felt really terrible, but it was just such a colossal mistake.  Apparently a misunderstanding/communication between her and the seller. Re the tenants:  I know, it was not at all ideal, but believe it or not, we don't have a lot of inventory, hence the willingness to compromise on these circumstances....up to a point.

SCA, yeah, never a good idea.

Dec 14, 2010 01:24 PM
Michael Jacobs
Pasadena, CA
Pasadena And Southern California 818.516.4393

Wow -- this is quite the story -- it sounds as if your client made the right decision to move on.   The situation with the tenant is a great one to let prospective sellers know --- let's make it easy to show your home -- if the tenants need to stay in place --- give them a financial incentive to let it be shown and to keep it in "ready to show" condition -- it doesn't need to be a big incentive but a gesture worth pursuing.  Regarding the condo docs --- shame on the HOA management company --- I have run across this a number of times when representing a buyer --- and now there are certain complexes I "warn" my buyers.  Now, I hope you find a great condo for your buyer --- good luck.

Dec 14, 2010 04:56 PM
Hella Mitschke Rothwell
(831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

The "24 hour notice" is odd, usually 48 hours or more notice is better for the tenant. And if the tenant didn't want to hear about it before, then the listing agent should have waited to make the call to the tenant until 24 hours before.  Strange thinking.

Dec 14, 2010 05:23 PM
George Bennett
Inactive - Port Orford, OR
Inactive Principal Broker, GRI

How frustrating for you and your client. I'm sorry that it didn't work out for her but she may have dodge some bigger problems with this property, their HOA, & the management firm. Good luck in finding an even better place for your client.

Dec 14, 2010 05:24 PM
Vickie Nagy
Coldwell Banker Residential Real Estate - Palm Springs, CA
Vickie Jean the Palm Springs Condo Queen

Unfortunately some transactions just don't come together as they should. At least you still have the buyer client.

Dec 14, 2010 05:30 PM
Stephen P. Panczak, Ph.D.
Keller Williams Coastal Partners - Palm Beach, FL
Real Estate Agent & Business Coach, (561) 254-8098

What a mess - sometimes it may be better to walk away from a mess like this transaction.

Dec 14, 2010 08:16 PM
Coral Gundlach
Compass - Arlington, VA
Real Lives. Not Just Real Estate.

Michael:  I know it, I always emphasize the importance of simple showing instructions.  And in this market in Northern VA, if the seller makes it easy to begin with, the whole process will be a lot shorter.   Like maybe only a month if you do it righ.

Hella: I know! Wouldn't anyone want more notice than 24? I thought so, after coming short the first time, that scheduling it way in advance would be helpful and was shocked when, while trying to set up an appointment, she told me to call back 24 hours in advance.  I eventually talked her out if it, but it took effort!

George: Exactly, when she was wrestling with what to do, I asked her what her gut said, (mine had already said run away as fast as you can) and she said she wanted to bail.  I had never been so happy to prepare a release form.   It was just too messy.

Vickie:  Yes indeed, there is a bright side!

Stephen: Exactly.

Dec 14, 2010 11:13 PM
Irene Kennedy Realtor® in Northwestern NJ
Weichert - Lopatcong, NJ

Coral,

The tenant was bad enough, but the listing agent making a mistake like that on the condo fee is unforgivable!  Shame, shame on him or her!

Dec 14, 2010 11:48 PM
Susan Jackson
America's Network Realty Group, Inc - Sandy Springs, GA

This sale just had too many loops to jump through.  First-- the 24 hours was ridiculius.  Next-- the occupancy date should have been stated upfront,.  The error in the condo fees was a hugh bobo.  Was the seller's agent new to the inductry?

Dec 15, 2010 05:09 AM
Coral Gundlach
Compass - Arlington, VA
Real Lives. Not Just Real Estate.

Irene:  I really feel terrible for the agent.  Not sure how such a mistake happens, but she was very apologetic about it at least.

 

Susan: Occupancy was stated up front, we just hated to agree to it, but it was take it or leave it and she loved the place.  As for the agent,  I am afraid not, lots of experience.

Dec 15, 2010 05:15 AM
Chris Ann Cleland
Long and Foster Real Estate - Gainesville, VA
Associate Broker, Bristow, VA

Too bad the Buyer had to come out of pocket for the home inspection only to have this deal completely fall apart.  I'm sure there's a better property out there.

Dec 15, 2010 08:54 AM
Not a real person
San Diego, CA

Best wishes for lots of fun and food with family and friends today. Hope Santa brought you some cool toys, too!

 

Happy Holidays!

Dec 25, 2010 05:43 AM
Tamara Inzunza
Realty One Group Capital - Alexandria, VA
Close-In Alexandria and Arlington Living

Wow Coral, talk about NEON signs all the way.  It definitely was not meant to be at all.

Jan 15, 2011 02:15 PM