It’s rare in this business to see things that “never happen”. Perhaps if you were just starting out in the real estate business you could say that you “have never seen this happen”. But it’s a whole other thing to say this literally “never happens”. I spend a lot of time in mastermind meetings with colleagues, talking with close colleagues who have an excellent performance record, our managers (who are top notch) and I also speak to a select handful of excellent agents outside of my brokerage. I’d like to believe that I have a good sense of what is common and uncommon after ten years of working in the Toronto Real Estate market and associating myself with other successful, consummate professional realtors.
This all brings me to an example of a deal I completed for some clients a little while back. The dust has settled now and the deal closed so I will go into some detail but not a full expose.
Facts:
- The house listing that my buyers wanted to make an offer on was listed with an “offer hold back date” (ie., wait 7 days for offer night, then be in a bidding war).
- There was no pre-list home inspection (not a wise move by the seller or the listing agent’s behalf). Without this it is more likely that you will: 1) get less money for your home; 2) less buyers will offer; 3) if someone doesn’t have a chance to do a listing inspection before the offer night then you simply won’t be competitive (and/or refer to point “2” the buyer may not offer which then leads to point “1”…home sells for less money than it is worth.
- The house was underpriced by approximately $200K, which represented roughly 20% of the value.
My clients and I went into the house on day 1 of the listing. They liked it, so much so that they wanted to do a bully offer (offer prior to offer date set out by listing agent). I proceeded to call the listing brokerage to ask for the pre-list home inspection (so my clients could review the details of the home and so they could decide if they would like to make an bully offer). The brokerage said they didn’t know of one available but paged the listing agent for me so that I could ask directly. I got a text back saying “no pre-list home inspection”. Frankly that wasn’t an agent making much of an effort to be communicative with a potential buyer agent for their listing. I pursed more of an explanation, I called this agent back. I asked whether one was coming in the next few days. This agent said that “no there would be no home inspection done”. I then asked if I could book one for the following day. What ensued was the beginning of the long list of things that “never happen” in real estate. This agent said that “no you cannot do a home inspection as we would put holes in the walls and wreck the house” (I’ve never seen that happen!!!). I tried to talk her extreme reaction back from the ledge. It was futile. I spent 15 mins having the most ridiculous conversation I have ever had with any agent in the business (at least to date of this blog post). It was shocking. Long story short, her suggestion was to bring a conditional offer on offer night, conditional on home inspection. Anyone working in this business with adequate training and a solid dose of common sense would know that that approach will not lead to success for your buyer. You will lose in competition even if your offer much more than the next buyer offer that has no condition. I got off the phone as I needed to gather my thoughts after being exposed to such a peculiar conversation.
What I came back to her with was a very BIG “this never happens”…I came back with a conditional bully offer…now, to be clear this should not work! It would be a rookie move to offer this let alone the listing party deciding to accept this prior to offer night. But, I thought why not try something I wouldn’t normally suggest to anyone in a million years!?!? It throws off the entire momentum and strategy of the listing. It would likely cause your seller to lose out, big time! I was going against my intuition as a realtor who lists, I would never let my seller accept this. A bully must be the biggest possible offer price (to convince the seller to trash the original listing strategy and choose to accept) and zero conditions (because a buyer can walk away without much cause, thereby leaving the seller trying to pick up the pieces of the train wreck). Not only did we bully with a condition but we also did something else that “never happens”, my clients lowered the offer price by nearly $100K…seriously. I felt like this may just work our, as things that “never happen” were happening!
It worked. I’m still shocked to this day. It’s been an example that has been talked about throughout our offices for quite some time, as this “never happens, so let’s learn from it”.
The funny thing is that my buyers decided to do something else during the conditional period which “never happens” in this market, they wanted an abatement on price (ie., subtract from their initial offering price), this market has been too hot to possibly ask for this as someone else will pay that price, maybe even more. The typical response from a realtor is “take a hike”. But, hey! It worked, call that a double dose of this “never happens”.
The amendment was sent through, subtracting the condition and some of the asking price. So there you go, we had a firm deal.
My buyers had a clause sating that they had the right to 3 visits prior to closing. Yup, there’s more. They were only allowed 1. The listing agent claimed that the mortgage appraiser and home inspector were buyer visits. Well, no, these are not. The home inspection was a condition unto itself. The mortgage appraiser was not a buyer visit and is always considered an item unto itself. The 3 buyer visits were its own distinct clause. By pulling teeth we managed to get the agent to agree to permit us in each of the following two visits. Both of which my manager had to call the listing agent’s manager…again, “this never happens”!
I’m going to stop the story here. By let me tell you…there are 5 other “this never happens” scenarios along the way.
The moral of the story? Hire a pro.
Hire someone who will creatively find a solution to anything that comes up along the way, someone who is proactive and focused on steering the ship to the goal.
Our jobs can be very challenging but not as hard as this deal was to navigate. The seller made far less money than he could have, likely experienced more stress than necessary; the buyers made off like bandits, also had more stress than necessary, despite every effort I made to navigate this mine field. The ridiculous scenarios that arose from the listing agent caused unnecessary drama.
I do my best to shield my clients from the drama and stress. It’s my job to bring solutions, which I did. But, when continually driving into a brick wall my clients knew that something was up, and that something was not our cause.
My clients are happy and that’s what matters to me.
When I say that “this never happens” it’s true, it’s an industry rarity.
