I love my chosen profession for many reasons but there are times when it’s not so fun. There is a scary side.
It has been a seller’s market for some time now but unfortunately some sellers have gotten greedy. Recently a client put an offer on a house in East Nashville. My buyer has been looking for a while and losing out on houses due to multiple offers. So she decided to go in strong with $20k over asking, this was happening fairly often in the area. Her offer was accepted. When the inspection was done, a lot of deferred maintenance was uncovered, potentially $15 to $20k in repairs. The sellers did not want to make any of the repairs so reduced the price by $6,000. We countered but the seller would not budge even though they had a contract at $20k over asking. They relisted the house and got another offer less than my buyer’s offer and with repairs requested. So this seller lost out both with a reduced price and a delayed closing still doing the repairs needed.
Original Offer the Best
Another client put a strong contract on a condo in Nashboro Village, just over asking. The sellers also received another offer so requested highest and best bid which is an option for sellers. I did not know what the other offer was but my buyer decided he didn’t want to go back with another bid. Once the deadline for the highest and best past, the listing agent contacted me 3 or 4 times for my clients offer. Checking the record later it was clear that my client’s original offer was the best they had received but because they wanted more they lost out and ended up selling their home for less than they could have.
A current client is looking for a house to rehab and we have looked a quite a number of properties. However the asking prices are near or comparable to homes that have been well maintained or already remodeled. Sellers hear about a home in their neighborhood selling for $XX and immediately assume theirs will sell for the same regardless of its condition. And their Realtor cannot convince them otherwise. So their property sits on the market, because buyers have market information from which to make informed decisions.
Certainly, sellers should try to get the highest price for their home when they sell it but let’s not get too greedy, sabotaging deals and getting less or leaving their homes languishing on the market.
Let’s Be Reasonable
Now buyers can be scary too. On the flip side of the first example above, buyers often ask for too much in repairs. If the home is not new construction you are buying a used home and some wear and tear is expected. Now large ticket items like roofs and HVAC systems that are in disrepair should be fixed or replaced or taken into consideration in the price. And certainly anything that is unsafe- wobbly stairs, loose handrails, broken locks, broken windows, etc. should be repaired. But here are a large number of items buyers should not expect to be perfect – nicks and scuffs on painted surfaces, loose or missing weather stripping or grout, dirty air filters, etc. Reason and reasonableness are important for a successful transaction.
The Deals are Over
Buyers also have to be realistic about pricing in today’s market and stop looking for “deals”. It is a sellers’ market and will be for a while given that our inventory is at all times lows and the number of buyers are growing as fast as Nashville is growing. Other agents have discussed clients that have put in 5, 6 or more low offers for clients that were looking for deals. This wastes both the client’s time and the Realtors. For the most part sellers know what their property is worth and can provide comparable sales in the area to support it. There may be a time when ‘deals’ will be back on the market but it won’t be soon, at least not in Nashville and the surrounding area. I and many others do not think that our bubble will burst anytime soon, if fact it’s probably not a bubble.
Let me know if you’re ready to sell or buy or know anyone else who is, I would be honored to work with you or your referral. And help you from being one of the scary ones.