It happens with almost every other buyer. Buyer sees a house they LOVE online but it's not on the list of Active properties I send them. Or a buyer drives by a home they didn't see listed online. They ask me about the mystery house and when I go look it up in the NTREIS (North Texas Real Estate Information Services) MLS, it shows that the home is not available - either under Option or Pending.
I give the information to my buyers and explain what the different status' mean:
- Active Option - this means that the home has just gone under contract and is currently in the buyer's "Option Period". The Option Period - per the Texas contract - is a negotiable period of time (typically anywhere from 5 to 14 days) where the buyer is allowed to have inspections performed. Buyers can back out of the contract FOR ANY REASON during this Option Period and get their Earnest Money back - only forefitting a nominal "Option Fee" (usually $50-$200). These homes are usually the ones that appear to be ACTIVE when searching online.
- Contingent - the home has gone through the Option Period but still has a contingency to clear. The most common contingencies are Financing or the sale of a home by the buyer.
- Pending - these homes have cleared the Option Period AND contingencies. They are uaually just waiting for closing day to arrive.
However, even after I explain what status the home is under, the next day they still question WHY there is still a For Sale sign in front of the house when they drive by. And I suppose it's a good question.
Here's a few reasons why a REALTOR might leave up the For Sale sign even though the home is no longer Available:
- Marketing & Exposure - being able to put up an "Under Contract" rider on the agent's sign is GREAT exposure! Neighbors and buyers drive by and see that the listing agent was able to sell one of the homes in their neighborhood, and instantly a potential seller might think to call this agent if they were at all curious about selling THEIR home.
- DEALS FALL THROUGH! All the time! If for some reason the current buyer backs out of the contract, the listing agent hasn't lost any marketing time by taking the For Sale sign out of the yard.
- To pick up Buyers (aka Potential Clients) - interested buyers driving by the home can call the number on the sign for more information about the home. If the home is already under contract, the listing agent can use this as an opportunity to tell them about other homes for sale in the same neighborhood and potentially gain them as a client.