The weather surely signals that it's midsummer, but the slow start to the real estate year means that the dog days of summer have a little more life to them. We are still seeing new listings, new offers, and new sales. Our web hits doubled from May to June. There was a downward blip for the Fourth of July, and then they went up again. People are clearly thinking about buying and selling, even if every contract seems a long and tortuous process.
On that note, I was spending the weekend in Vermont last weekend with a friend from North Carolina. She was trying to close the sale of a commercial building, which she had sold already once and it had fallen through. She was in negotiations with the new buyer on the day before what was supposed to be the closing. Her husband was bemoaning her travails. I told him that MOST commercial contracts seem to fall apart at least once, and that it is, unfortunately, very common for the buyer to come back at the last minute and ask for concessions, often due to financing conditions. Even in residential, we have a number of contracts now that seem to have taken on a life of their own. They go on and on, with delays, threats, changes, grandstanding, and probably tears. I'm telling you this so you won't take it personally if it happens to you! Forewarned is forearmed.
Showing posts with label contract. Show all posts
Showing posts with label contract. Show all posts
Tuesday, July 12, 2011
Monday, June 7, 2010
Buyer Brokerage Again
It's time to explain buyer brokerage again. The real estate business has changed a great deal over the years, and buyers don't always understand the changes. It is similar in many ways to the medical field, where privacy concerns have led to the HIPAA law, requiring patients to sign documents each and every time that they see a physician. Even lawyers have gone in this direction; a client must now sign a retainer agreement before any work on his or her behalf can begin.
Well, we have those rules as well. When you begin to work with an agent, he or she is required, at the first significant contact, to present representation forms. Although we are allowed to take you into our own listings, that is because, in those cases, we represent the seller. We cannot take you into someone else's listing without having buyer brokerage. If we do, we don't have to be paid. Would you work at your job without knowing whether you are going to get a check?
These rules are also for your protection. If we don't represent you, we cannot tell you things that it would be in your interest to know. For instance, we are only supposed to tell you the listed price without a buyer brokerage agreement, not what we think you should offer or what we think the property is actually worth. The current regulations arose out of a genuine feeling that everyone deserves his or her own agent, looking out for his or her own interests. Almost all of the time, the seller still pays the commissions to both agents--that's because the seller is the one with the cash, since buyers cannot roll commissions into the mortgage amount. However, even that will probably change some day.
In the meantime, be kind to your agent who asks you to sign a form that you didn't used to have to sign. He or she is just trying to do his or her job in the best possible way, and to help you get all the information you need to make a good decision.
Well, we have those rules as well. When you begin to work with an agent, he or she is required, at the first significant contact, to present representation forms. Although we are allowed to take you into our own listings, that is because, in those cases, we represent the seller. We cannot take you into someone else's listing without having buyer brokerage. If we do, we don't have to be paid. Would you work at your job without knowing whether you are going to get a check?
These rules are also for your protection. If we don't represent you, we cannot tell you things that it would be in your interest to know. For instance, we are only supposed to tell you the listed price without a buyer brokerage agreement, not what we think you should offer or what we think the property is actually worth. The current regulations arose out of a genuine feeling that everyone deserves his or her own agent, looking out for his or her own interests. Almost all of the time, the seller still pays the commissions to both agents--that's because the seller is the one with the cash, since buyers cannot roll commissions into the mortgage amount. However, even that will probably change some day.
In the meantime, be kind to your agent who asks you to sign a form that you didn't used to have to sign. He or she is just trying to do his or her job in the best possible way, and to help you get all the information you need to make a good decision.
Tuesday, October 6, 2009
Tough to the Finish
We had a buyer panel a couple of weeks ago, with people who'd bought their houses from us recently. I was surprised at the number of problems that came up right before, or even during, the closing. Two of the three were packed and ready to move before they knew whether or not the other party would be able to perform.
While we in the business all know that the transaction doesn't end with the signing of the contract, even we didn't quite realize that the obstacles in a sale are moving farther and farther down the pipeline. It used to be that the big hurdle was getting the contract signed. Then it was the inspection, and renegotiations after that. Next came the appraisal. Now it's the financing, which is often so problematic that the contingencies last right up until the closing day.
The good news is that all the transactions went through, even though one poor buyer started with six weeks to move and ended with two days. It was also good news that no one thought that his or her Realtor was to blame. It shows, however, that moving (no matter what we tell you) is hard to make easy. Leave plenty of time; expect things to go wrong; don't sweat the small stuff; and keep a sense of humor!
While we in the business all know that the transaction doesn't end with the signing of the contract, even we didn't quite realize that the obstacles in a sale are moving farther and farther down the pipeline. It used to be that the big hurdle was getting the contract signed. Then it was the inspection, and renegotiations after that. Next came the appraisal. Now it's the financing, which is often so problematic that the contingencies last right up until the closing day.
The good news is that all the transactions went through, even though one poor buyer started with six weeks to move and ended with two days. It was also good news that no one thought that his or her Realtor was to blame. It shows, however, that moving (no matter what we tell you) is hard to make easy. Leave plenty of time; expect things to go wrong; don't sweat the small stuff; and keep a sense of humor!
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