Sellers Have Got to Face Reality

By
Real Estate Agent with The Gibsons at eXp Realty
From time to time I get emails from sellers who submit their information, on a house they want to sell to an investor, at QuickOffers.com. I am the Monmouth County, New Jersey affiliate.

I just got an email from a seller in New Jersey who says:

"We are currently listed with a real estated agent, but because of the 6% commision it makes it difficult to come up with a price that works for everyone. We have had two offers. However, they were not the right ones."

This is what I told him:

You have to face the reality that you can only sell your house for what a ready and willing buyer will pay. How much money you need is irrelevant. (sidenote: I might have been a little blunt here, what a seller needs is not totally irrelevant, but they can't always get what they need.)

Investors buy at a discount or take over your payments. So, if you won't sell for what an owner occupant would pay, I am sure you would not sell for what I would offer, which would definitely be less. Unless you were willing to allow us to take over your payments for a few years and pay you your equity part in cash and part in payments.

I suggest you go back and see if those people are still interested. Were both offers near the same price? If so, that is about what your house is worth in this market.

If the reason you won't take these offers is because you need a certain amount of money to move or you owe more on the house than would be covered by the price, you have some options.

If you owe more than the house will sell for plus commissions, and you don't have the cash to bring to closing to pay for the commissions and your closing costs, you can ask your agent and their broker if they would take payments for all or part of the commission. Some will do that because it is better to get part now and the rest later than no sale at all.

If you owe more than the house will sell for (with or without the commission), you can try to negotiate a short sale with the bank. A short sale is when the bank agrees to take less than is owed on a mortgage as payment in full. You will be able to list the real estate commission as an expense to reduce the mortgage payoff amount.

Be warned you must show that you have some financial hardship, like you must move, or lost your job or something and a short sale can take 1-4 months to complete or more.

If you rejected these offers because you need a certain amount of money to move or buy another house, I am sorry to say that you probably won't get better offers in this market. But your agent will advise you on that.

Sorry to be so frank, but if you really want to sell you house you must face the realities.
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If he replies, I will let you know what he said.
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

I LOVE THIS POST.

Sellers simply have to be told the truth about what it takes to sell that house, not what it takes to get the listing.  Once the overpriced homes shake down to prices buyers will pay, about 10-20% lower than today's list prices by my estimates, the buyers will return in droves , , , ,  once their recently renewed leases end.

Flagged.  I'd love to see this featured.

Apr 30, 2007 11:37 PM #1
Rainer
68,846
Christopher Benedict
BIG Realty - Collegeville, PA
AskTheBigGuy
No buyers want to overpay in this market, and the sellers have to realize that the past is the past and GET OVER IT!  It takjes more than a sign in the yard to sell a home in this market!
Apr 30, 2007 11:48 PM #2
Ambassador
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Brian Schulman
Coldwell Banker Residential Brokerage, Lancaster PA - Lancaster, PA
Lancaster County PA RealEstate Expert 717-951-5552

I thought your answer to this seller was excellent, except for the part about asking the agent to take partial payment.  I have been licensed for 24 years, and although I reluctantly agreed to such plans once or twice, I have never gotten paid more than what I received at the settlement table.  I don't know how an agent could be guaranteed to be paid the remainder, unless somehow a lien could be gotten on another piece of real estate owned by the seller in the same state.  Often financially strapped sellers won't be owning another property for some time.

Quite frankly, Im not so rich that I can afford to give full measure of my time and talent for half compensation. 

Apr 30, 2007 11:54 PM #3
Rainmaker
22,809
Theresa "Tracy" Gibson
The Gibsons at eXp Realty - Matawan, NJ
Your Needs Served

Thanks Brian for the kind words.

 I figured I would get a comment like yours on the commission work out.

What would you suggest as a solution?  If the seller does not accept the offers for less than they need the agent will get nothing anyway.  I would really appreciate solutions to this dilema.  I have had quite a few sellers that are upside down call me recently.  They are listed, but can't get what they need to pay everything.

Maybe the solution for those agents is to not take the listing in the first place.

Thoughts?

May 01, 2007 12:32 AM #4
Rainer
35,583
Carmen Offutt
La Rosa Realty - Altamonte Springs, FL
Unfortunately that is happening more often now, and it is not going to change soon.  I think you had the right approach. It is sadly the reality of our market now.
May 01, 2007 12:58 AM #5
Rainer
28,572
Colorado Springs Real Estate
Colorado Springs, CO
Sellers want top dollar, buyers want a bargain. The same real estate conundrum in every market.  
May 01, 2007 02:13 AM #6
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Rainmaker
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Theresa "Tracy" Gibson

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