If you Google “fair deal in real estate,” what pops up are links to vacation properties in Trinidad and Tobago. Now, I’m not looking for a vacation property right now and I’m pretty sure that if I was, my partner wouldn’t let me buy in Trinidad or Tobago, not that there is anything wrong with that.
I am a real estate agent in DC/MD/VA working as a buyer’s agent for one of the nicest couples that you’d ever hope to meet. To me, as a buyer’s agent, this couple, let’s call them Sally and Harry, are the perfect clients: solid employment history, good income, healthy savings, intelligent, thoughtful and humorous. Sally and Harry have realistic expectations and understand that buying renovated homes in D.C.’s most popular neighborhoods would be expensive and they would have to act quickly.
Over the past month, after submitting three or four VERY strong offers, with strong escalation clauses, no contingencies, and having completed pre-offer inspections, they have yet to land the winning bid.
A home inspection for the size home they are seeking costs between $600-$700. To date, none of the inspections yielded any flaws in the home that either were not disclosed by the seller or would have stopped Sally and Harry from moving forward. Did I mention that Sally and Harry are intelligent and understand that no home is perfect? Realistic expectations.
Frustrated, Sally and Harry no longer want to spend the money for an inspection prior to submitting an offer on a house. So last week, we submitted an offer on a charming house that received a total of three offers. We included a two-day home inspection contingency without the ability to void the contract, escalated in $10,000 increments above the next highest offer and had no financing or appraisal contingencies. Truly a strong offer and a great deal for both sides.
Guess what? Sally and Harry didn’t get the house. The sellers decided that the risk of a home inspection exceeded the value of an additional $10,000.
Now I am asking myself when did we get into such a rush that a successful real estate transaction is measured in terms of time, number of days on the market, instead of a net dollar amount for the seller and a well informed and happy buyer? Sally and Harry were happy to pay a premium of $10,000 to have a home inspection and negotiate in good faith. They did not have the right to void the contract. The house appeared sound and the seller’s disclosures indicated that it was well maintained. I am pretty sure the sellers could use $10,000. So why the rush? Is the speed of a transaction the best metric to evaluate a successful transaction? Is a successful sale really measured more by the days on market versus the net proceeds to the seller?
I believe as agents we can remove the emotion and stress from a very personal transaction and help buyers and sellers, through negotiation, reach an equitable deal. A win-win. But a win-win can often take a bit of time, effort and nuanced thinking.
What does $10,000 mean? You can buy a used car, replace 15 windows in your house, shop for a family of 4 for at Whole Foods for a month (just kidding), you can spend a month at Club Med in Cancun with your family, you can take a cruise with your partner and have change left over. Ten grand is a whole lot of money.
So again, the question is why aren’t agents working harder to make it work for everyone? An increase in $10,000 in sales price to the listing agent’s commission is $250 or $300, perhaps not enough to make the effort? The bottom-line? Buyers and sellers should take another look at the current home selling model and give it some serious thought. There may be a lot of money at stake. Their money. Have your agents work for you and negotiate a thoughtful, nuanced and profitable transaction that creates a win-win feeling for both parties.
Leyla Phelan is with the Denny & Leyla Team at Evers & Co Real Estate, Inc.,
202-415-3845 or Leyla@DLTRealtors.com.