Break It, End It, Change It

#1 in a series on “Change” (in Real Estate)

Karen Schlosser

Karen Schlosser

If It Ain’t Broke, Break It…Necessary Endings…The End Of Business As Usual

These are titles of books that I’ve read, in whole or in part (my disclosure), that have to do with change. Admit it…the business of real estate has changed much to the chagrin of many…sellers, buyers and agents. Some of those same folk are trying to keep real estate “business as usual”:

Why? You tell me. Is it that they feel life isn’t fair? Do they feel it’s harder to work in today’s environment and they don’t want to exert the necessary energy?

Is life fair? I believe life is fair, you get out what you put in.

Is it harder to work in today’s environment? It certainly seems harder because it is different.

I recently had a conversation, albeit brief, with a seasoned professional who remarked about a situation that she had advised a client was illegal/unethical by saying, “I’ve never seen it 27 years, it’s crazy”. My immediate thought was this professional marches to the mantra, “If I’ve Never Seen It, It Must Be Illegal/Unethical”. Before hanging up the phone I should have suggested that she read the books above that underscore:

There has been change;
There will always be change;
There needs to be change;
Shift happens.

But alas, it would have fallen on deaf ears because someone who marches to the mantra, “I’ve never seen it, so it can’t be” is living in a rigid world, one that is inflexible, unwilling to learn or change, a march that will hinder their personal or company growth. Why is this topic on my mind? Because of my daily conversations with agents, buyers, sellers and prospective real estate consumers who continually ask questions about the market, about the business, so I thought I would answer some of the most popular questions that I’ve received in the past few weeks.

Q. What’s going on in the market? (February 2012 Charts)
A. People are buying, selling and leasing homes. When you take a look at the attached charts you will see sales are up 16% February 2012 over February 2011; over 40% of the sales are lender-involved (i.e. short sales, lender-owned, government-owned); active residential (single family & condo) inventory is down by 14% for the same time period; absorption rate is down by almost 30% from 13.4 to 9.6 months; proceed with tempered enthusiasm because the average sales price is down by 10% from $143,926 to $130,087, a result of more homes selling at a lesser price which you can see by the chart that displays the number of homes sold in various price ranges. Although absorption rate is down it is still way above the range of a balanced market which means it is still a more favorable environment for buyer’s to reap benefits as well as seller’s who are buyers.

Q. Can a seller write an offer to a buyer?
A. Yes.

Q. Is a seller or buyer required to response to an offer or counter-offer?
A. No.

Q. Is an agent required to present all offers and counter-offers, both verbal and written, to their client? Until when?
A. Yes, until the property closes or instructed by their client to do otherwise.

Q. Is a verbally accepted offer enforceable?
A. No.

Q. Must a seller complete a residential property disclosure form even if they have never lived in the property?
A. Yes, unless the seller falls into one of the limited exemptions. Never having lived in a property is not in and of itself an exemption.

Q. If a seller receives more than one offer, are they required to tell the parties there are multiple offers?
A. No.

Q. If an agent receives more than one offer on a listing, can they tell the parties there are multiple offers?
A. No, unless their client directs them to do so.

Q. Can a seller counter more than one offer at the same time?
A. Yes, provided they use skill and care.

Q. Can a seller counter for more than the asking price?
A. Yes.

Q. Can a buyer terminate the contract within the Inspection Period set forth in the [Board of Realtors] Contract to Purchase?
A. Yes.

Q. Can a buyer terminate the contract within the Settlement Period set forth in the [Board of Realtors] Contract to Purchase?
A. Yes.
Q. Does the [Board of Realtors] contract become null and void because the buyer and seller did not enter into a written settlement agreement during the Settlement Period as set forth in the [Board of Realtors] Contract to Purchase?
A. Yes.

Q. During the Settlement Period, can a buyer withdraw their requests for repairs/remedies and purchase the property “as is”?
A. Yes.

Q. Can a seller terminate a contract during the Inspection Period or Settlement Period as set forth in the [Board of Realtors] Contract to Purchase?
A. No.

Q. Can a buyer terminate a contract if the property doesn’t appraise for the final sales price as set forth in the [Board of Realtors] Contract to Purchase? Even if it’s $1,000 less than the final sales price?
A. Yes. Yes.

Q. Can a seller terminate the contract if the buyer does not provide written verification of funds or pre-approval letter or written loan commitment as set forth in the [Board of Realtors] Contract to Purchase?
A. Yes.

Q. Can a seller accept more than one offer contingent upon third party approval(s) and submit all accepted contracts to their lienholder(s) for approval?
A. Yes.

Q. Should a seller send all offers received to their lienholder?
A. Yes, particularly offers that may net the lienholder more money.

Q. Can a seller’s lienholder sell the property to more than one buyer?
A. No, but if they could they would.

Q. Can a seller counter an offer on a short sale?
A. Yes.

Q. Can a lienholder require the seller to sign a note to repay some or all of the deficiency?
A. Yes, unless the lienholder has subscribed to follow the HAFA guidelines.

Q. Can a lender require that the buyer use a particular title company?
A. No.

Q. Can a seller require that a buyer be pre-approved by a particular lender?
A. Yes, if it is written into the contract.

Q. Can an agent offer to reduce their commission, buy a home warranty, pay for closing costs, provide maid service for a year, or something form of inducement to a buyer or seller to enter into a contract to buy or sell?
A. Yes, provided it is written into the contract and signed by all parties.

Q. Will every person who wants to buy a house be able to?
A. No.

Q. Will every house sell?
A. Yes, for the right price and circumstances.

Q. Will the sun be shining tomorrow?
A. Yes…somewhere.

This post is from:

Cincinnati Area Real Estate Agents, a LinkedIn page
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