Buying a Home, Four Daughters Real Estate, Real Estate Adventures

Listed, but cannot show?!?

Huh? That’s often what my clients think when I set up showings and we cannot get the showing confirmed. One would think that in a down but improving real estate market it would be in the best interest of the seller to show the home to prospective buyers with hopes to receive an offer…yes and no. (there is that “Huh?” again)

Here are a few scenarios where setting an appointment may not result in a quick showing:

  • Tenant Occupied: Tenants have the right to request 24-48 hours notice prior to showings taking place. Why? They have the legal right to enjoy their space, do not benefit from the sale of the home, and frankly, they get the short end of the stick by having to take showing requests, accommodating the showings at various times of the day, and with no financial benefit. Some tenants prefer to be home during the showings to “protect” their belongings which means showings may need to occur around tenant schedules. They are however entitled to the Quiet Enjoyment of their home, so blaming them for a cancelled showings is not productive. Patience is key. (this is not legal advise, and we are not lawyers)
  • Short Sale Gimmicks: Due to the large amount of short sales, the process has historically taken anywhere from 90 days – 2 years before the bank takes steps to evict & foreclose. Some sellers will list their home for short sale to start gaining market exposure, however decline showings. Why? Because many people starting a short sale often default on their mortgage and tax payments. No payments means more money directly in their pockets. The longer they live for free, the more money they can save (theoretically). This is a dangerous approach because the foreclosing bank may expedite the foreclosure and leave sellers with little time to market for short sale, or take over the home prior to closing. Also, in a short sale, an owner-occupied home owner can sell for less than owed to the bank (subject to lender acceptance) and often prevent a deficiency judgement which would demand repayment of the bank’s losses. In a foreclosure, however, there is a great, almost certain possibility that deficiency will be required + 7-10 year hit on credit for foreclosing or possible bankruptcy. It’s a risky gamble, and preventative education is key when preparing sellers for such an outcome.
  • Personal Reasons: No matter how much the seller wants you walking through their door, some personal matter may be preventing it. Out of town guests, birthday party…etc. Some sellers have fun with it and will invite a showing in a middle of a family party. We’ve walked into a party greeting us with a hot dog and soda. (Yes, the guests are like ….HUH?) If seller doesn’t mind, most buyers will not mind either, and may event enjoy the event.  Sellers undergoing less festive moments may ask their Realtor to take the listing Temporarily Off The Market to halt showings and reduce market time.
  • Sold, but still shows Active: Nearly every home buyer initiates their home search online via the hundreds of websites available to the public. These sites gain their Property Information by purchasing listing data from the MLS (Multiple Listing Service) which is filled in by local Realtors, in real-time. Although technology is getting faster, there is often a delay between the MLS and the web. Furthermore, real estate has the ability to function 24/7/365 and deals can get signed anywhere in-between.  I remember in a hot market we would negotiate sales contracts as late as 2am. Although an agreement was made, the MLS may have not been updated yet, and until it does, it shows active and agents may continue to try to schedule appointments for it. Life happens faster than the MLS.
  • Operations & Communication: Due to the rise in REO (Foreclosed and Distress Properties) companies managing a large inventory of homes  typically operate during bank hours (9-5 M-F). Their client isn’t a typical home seller, but a corporate representative of a 9-5 operation. Most agents will offer scheduling capabilities for after hour and weekend showings, but rarely are they available to discuss if the property is still available, answer questions, etc. You may find yourself viewing a home on Sunday which went under contract on Friday at 4pm and wasn’t updated in the MLS. Because REO properties are popular for their pricing they can grab attention quickly.

Advice: Understand that entering the home buying market is as if you were stepping onto a train, with momentum already in motion.  Some buyers got on a few days before and had a chance to do more searching or research, and many will get on after you, giving you the advantage.

Before getting your hopes up with a home online, get your finances in order (pre-approval or proof of cash funds) so when you step on that train, you will be much more ready to compete…oh, and don’t forget, enjoy the ride!

-Mario Bilotas, Four Daughters Real Estate

p.s. We are not lawyers, and in no way is the information within to serve as legal advice. 

 

 

 

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