Cosmic Cow Pie: Connecting the Dots

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My House Is Not Selling And I Want To Buy Now!

My House Is Not Selling And I Want To Buy Now! Clock

This is the dilemma I heard from a Broker I was talking with recently who was frustrated with a seller. The seller has an overpriced condo in an area which is not easily accessible from a main street. The seller wants open houses and newspaper ads to ger her condo sold so she can move on to a bigger home.  This sounded to me like a familiar problem.

The broker had given the seller the statistics of the sales in the complex and the prices.  The seller still did not want to reduce the price of the house.

I shared with the broker the four key factors that sell a home:

  1. Price
  2. Terms
  3. Condition
  4. Location

As we talked about the property the answer came down to PRICE, as it usually does.

I asked the broker if she had heard of "conditional marketing" and she had not.  I then thought this concept might be a great tool for any agent and seller looking to sell now and take advantage of some of the incredible values currently available.

The concept of "conditional marketing" includes listing the property with a contingency clause in the listing which is also included in the acceptance of any offer submitted on the property. It should remove all risk to a seller in a possible move up situation and puts them in the drivers seat in the transaction.

The process to offer a conditional sale:

  • The price of the home is reduced to a price which will attract a buyer to make an offer. 
  • The listing agreement has a clause which makes the sale conditional.  Anyone reading this should seek the approval of the Broker or an attorney to make sure you are complying with state and company regulations.
  • Possible listing clause to be approved by Broker:  "This listing is expressly conditional upon the seller contracting and closing on a replacement home.  Closing and possession must coincide and be concurrent or the listing contract is null and void."
  • When an offer comes in on the property a"conditional clause" must also be included in the acceptance.
  • Possible counter offer clause to be approved by Broker: "This offer is accepted expressly conditional upon the seller contracting on a new home within 10 business days of acceptance of this counter offer.  Closing and possession must coincide and be concurrent of the offer is null and void and all earnest money returned to the buyer.  Purchaser is aware if for any reason the seller does not have a simultaneous closing arranged on the replacement home this contract will be null and void and all earnest money will be returned to the buyer."

The listing contingency should make a seller feel more comfortable in knowing they are NOT committing to sell their home if they have not found and can close on a replacement property with terms and conditions that makes the transaction work for them.

A good way to explain to the seller the complete control they have over the transaction is to show them a pen and let them know they do not have to sign anything that does not meet their approval with the contingency.

One easy way of thinking about the equity in a home is a pile of money.$ cards  When looking to move from one house to the next house it is like moving one pile of assets to the next pile.  In today's market there could be a seller willing to contribute to the sale of another house in order to put the transaction together.  The seller might pay closing costs allowed by law.  The seller might do repairs needed to remedy a code violation.  The seller might pay additional commission to facilitate the sale on the other end.  There are hundreds of ways a transaction can be put together when you have a willing seller and a willing buyer. This concept can work with out of state moves too.  It just takes coordination with the lisitng agent and the buyer's agent in the new state.

I had a seller say recently they would NOT pay a buyers closing costs but they would reduce the price $5,000.00  They explained to me it was the "principle" of paying the buyers closing costs they did not agree with.  As I sat down and discussed the net proceeds I showed them that the $5,000 in the form or a price reduction would net them the same amount as paying $5,000.00 in buyers closing costs (plus the approx $30.00 in commission).  I explained the pile of money concept and that it was the same pile just how it was used and the name it was called. Showing them the bottom line helped them see it was the same net effect. When a seller really wants to sell it is wise to look at all the different ways to put a transaction together looking at the transaction as a whole which is a sum of the parts.

Re-framing the way we think and understanding in today's market we sometimes have to be creative in our real estate transactions. At the same time we have to stay within the lending guidelines and seller contribution regulations.

Communication is the key to the success in trying something different. 

Ask the seller:

  1. Do you really want to sell?
  2. Are you willing to take a "conditional marketing" approach to a sale?
  3. Do you understand that you will NOT have to sell if you cannot find a replacement home at price and terms you are happy with?
  4. Do you realize that the contract will protect you so you don't have to sell if ANYTHING goes wrong with the replace home contract?
  5. Do you want to reduce the price of the house so we can get in the market now with a conditional offer acceptance on your home and go shopping for your dream home?

The discretionary seller has nothing to lose but time with a "conditional marketing" plan.

The agent has to be willing to take on this conditional type of marketing and work with the seller as a team.  I know the plans works, it takes time, communication, patience and trust from all the parties.  This type of transaction creates client relationships for life as everyone is involved in putting the real estate dream together in a win/win/win situation. 

"Conditional Marketing" can be the key to new listings.  An agent can suggest to a seller fearful of today's market  the concept of listing the property with the contingency clause and see what happens. Investing a little time and money could result in the perfect buy. 

 

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Cosmic Cow Pie

Carra Riley

Comment balloon 96 commentsCarra Riley & Declan Kenyon • August 09 2010 11:14PM

Comments

Carra, as always you have hit the nail on the head. Motivation is crucial for any successful transaction.

Posted by Vickie Nagy, Vickie Jean the Palm Springs Condo Queen (Coldwell Banker Residential Real Estate) about 10 years ago

Carra,

Excellent post. Conditional marketing is not an easy sell, as there isn't much stability, and sellers and buyers are afraid of the contingencies to not work.

They might have a concern that someone can simply manipulate it and hold the porperty tied and then walk away.

But the concept is neat, thanks

Posted by Jon Zolsky, Daytona Beach, FL, Buy Daytona condos for heavenly good prices (Daytona Condo Realty, 386-405-4408) about 10 years ago

Interesting thoughts Carra. It always ends up price and motivation. Any idea added to our toolbox is a good one. Thanks

Posted by Randy Ostrander, Real Estate Broker, Serving Big Rapids and West Central MI (Lake and Lodge Realty LLC ) about 10 years ago

Vickie ~ Thank you.. communication about the motivation and then creating a plan leads to success for all.

Jon ~ You are right that conditional marketing is not an easy sell.  It is hard to get all the dots lined up with the new buyer, the new buyers agent, the new seller of the house the seller wants to buy and the new sellers agent.  So communication is key and they all have to have the same end in mind.... MOVING!  I know as almost 90% of all the sales I did for over 30 years were contingent with those clauses in the listing and sale contracts... some agents don't want to mess with them so I would just keep hunting to find the right people to put the puzzle together and get the sellers on with their real estate dreams.

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Randy ~  This is a great tool for helping any seller who wants to move up and also in getting new listings where a seller might be afraid to try in the current market.  As long as the agent is willing to try and put it together and the seller is willing to give the possiblity of moving some time.. it works! 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Very nice post Carra. Conditional marketing eh? Good stuff, and thorough explanation. Time for a repost.

Posted by Scott Hayes, Realty Austin, Broker Associate ((512) 786-8300) about 10 years ago

As mentioned above, a contingency sales from either side is not a very attractive proposition.  No seller in his right mind would want to take his property off the market waiting for a buyer to sell his home and likewise a buyer might lose out on another property while waiting for the seller to find his dream home.  It is an option, but a difficult one.  Another one is for the seller to request a lease-back clause.  This is more risky, but depending on the time allowed, it could work.

Posted by Jane Peters, Los Angeles real estate concierge services (Home Jane Realty) about 10 years ago

Scott ~  Food for thought.. thank you for the re-blog.

Jane  ~  I might not have made the transaction steps clear... Seller 1 who wants to move up.. does NOT put a contract on a house till they have an offer from a buyer.. and of course it needs to be a pre-qualified buyer with no contingencies... Then the acceptance clause gives the seller 10 business days to get under contract.. That does not tie up a house for too long... or a buyer waiting if they really want the house.

"This offer is accepted expressly conditional upon the seller contracting on a new home within 10 business days of acceptance of this counter offer."

This happens all the time in some states.. I know in California this is NOT the norm.. as it does create a web of transactions to coordinate. I have a great video review of a seller in California who purchased a home in Flagstaff, AZ.  He was so appreciative of the protective clause in the sale of his CA home.. the agent there was NOT a happy camper but it all closed and everyone was happy.. so it can work.. it's just "complicated" as they say. I'll go find it on youtube. 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

I've heard it so many times before.

Seller doesn't want to reduce, but when they go shopping, they expect all the other sellers to negotiate.

Posted by Ralph Gorgoglione, Hawaii and California Real Estate (310) 497-9407 (Maui Life Homes / Metro Life Homes) about 10 years ago

An interesting concept - and certainly helpful for the seller who doesn't want to be realistic in their pricing.  It's difficult to get seller's realistic in their pricing these days!  Good luck.

Posted by Rita Gibbons, The Gibbons Group (MacDoc Realty LLC) about 10 years ago

Ralph ~  This plan has eveyone pitching in or working together.. when a seller really needs to move a propery they are open to ideas.. when a seller really doesn't care if they sell.. maybe that home might not be a great listing to have in this market with today's buyers.  We all have to make business decisions as to what situations we want to work through.. this concept is certainly not for all sellers or agents.  It's HARD to work this type of transaction. 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Rita ~ it is hard to get all the dots connected!

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Great explanation Carra.  This can work but I don't think asking a buyer to risk 10 days is the biggest issue.  My concern isn't for the first transaction on the chain but the second one (and third and fourth).  The move up seller is going to need to ask the seller of the home they want to purchase to accept a sale contingency in their offer as well so, if their buyer loses financing not one, but two contracts fall through and so on through the chain.  Unless they are accepting a cash offer, I think the best option is for sellers to sell their home, close and move in to short term housing while they look for their next home.  Wishful thinking and darn near impossible to sell a client on I know :)  But maybe my brain is just wired that way today since I just had a deal fall through because the buyers lost financing.... Thought provoking post!

Posted by Lori Liveston (Virtual Homes, Real Estate) about 10 years ago

Carla - Home sellers want to sell and buy another home need to be educated to sell at little less than market value for quick sale.

Posted by John Pusa, Your All Time Realtor With Exceptional Service (Berkshire Hathaway Home Services Crest) about 10 years ago

Lori ~ You bring up valid points and reasons to have buyers with pre-approval letters subject to appraisals... that is another post in itself.  I had counter clauses about what the lender letter had to say and now with the new HUD requirements.. a buyer really needs to be committted to get all the documentation in and ready to buy.  It is hard to connect all the dots with 3 or possibly 4 transactions but it can be done, just hard work and lots of coordination. 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

John ~  Price fixes everything!

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

I'm suggesting this for a feature Carra - it's been the subject of lots of discussions at my office and I'm interested to see how everyone weighs in!

Posted by Lori Liveston (Virtual Homes, Real Estate) about 10 years ago

#14 has us confused?!?  You post is great and an wonderful tool when listing a property with a seller who can move up, but wants to be (as you said) in the driver's seat.  Well worth a suggest!! 

Posted by Carla Muss-Jacobs, RETIRED (RETIRED / State License is Inactive) about 10 years ago

Lori ~  Thanks so much.... the idea is another tool to work with to help the consumer.

Carla ~  Thank you so much.  I hope this idea can create some new transactions for agents.  It is a very difficult concept but if all the players have the same goal in mind, it works! 

This is a link to a client, both seller & buyer who shared how he felt the process worked for him!

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Carra, I have used the conditional sale clause before.  It works.  And the pile of money concept sometimes works if people cannot grasp the concept of closing costs just being another avenue to putting the deal together.  Nice post! 

Posted by Don Sabinske, Sabinske & Associates Inc. (Don Sabinske, Sabinske & Associates Inc.) about 10 years ago

Carra, We've done this once, but isn't a common practice for us.  It's hard enough to "sell" a contingent on another sale offer as it is in our area.  Throwing in a suggest with Carla, let's see if we can get you a front page, very well written and explained!

Posted by Liz and Bill Spear, RE/MAX Elite Warren County OH (Cincinnati/Dayton) (RE/MAX Elite 513.520.5305 www.LizTour.com) about 10 years ago

Carra, we often see the comments on some listings that the seller 'must find suitable housing'. Hopefully they clarify that in the contract similar to what you offer within the post.

Posted by Ed Silva, Central CT Real Estate Broker Serving all equally (RE/MAX Professionals, CT 203-206-0754 ) about 10 years ago

Carra:  Reading this I am really wondering, are there agents out there that will go after commissions from sellers that go under contract, but aren't able to find their home of choice?  I would never have the nuts to do that.

Posted by Chris Ann Cleland, Associate Broker, Bristow, VA (Long and Foster REALTORS®, Gainesville, VA) about 10 years ago

Don ~  Glad it is working for you!

Liz and Bill~ I appreciate the suggest. I find the engagement very interesting and would love to see what more agents all over the country are saying.....thank you!

Ed ~ each agent and broker should have the definition of "agency" underlying their actions with serving the client and what they want.

Chris Ann~  Good point... what are we working for?  Going that extra mile to protect a discretionary seller is what creates the customers for life.

 

 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Carla, a suggested post for sure and reblog.  I am also forwarding to my broker.

Posted by Rebecca Gaujot, Realtor®, Lewisburg WV, the go to agent for all real estate (Vision Quest Realty) about 10 years ago

Rebecca ~  Glad you liked it.. it seems to me like a way to create new business and help sellers who need to seel and are willing to participate in a creative transaction.  It is really a mindset!  Thank you for the suggest and the re-bolog.. I really like the discussion and am learning from the comments! 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

The buyer could be out money for an appraisal and home inspections while the seller is deciding if they can get the right deal. 

Posted by Yvette Chisholm, Associate Broker - Rockville, MD 301-758-9500 (Long & Foster Real Estate, Inc.) about 10 years ago

You have to keep the seller focused on the bottom line.   Focus on their net...not where each line item is going...it doesn't really matter how you cut the pie...if it is the same one.

Posted by Alan Bruzee (Long & Foster Real Estate, Inc.) about 10 years ago

Carra - motivation and price are the keys to selling any home.  As stated in some of the comments above, it's not always an easy sell, but it sometimes does work as the seller's motivation increases.

Posted by Lori Mode, Real Estate Made Simple (The Mode Real Estate Group) about 10 years ago

Yvette ~  Great comment and important part of the transaction..... the way I protected that cost to the buyer was to include the fact that none of time frames or costs for appraisal or inspection would start until the seller got officially under contract. Hope that makes sense... the buyer is giving up 10 business days to see if they can purchase this house... Could be the buyer might be in too much of a hurry and moves on to another house.. that happens...but if the buyer loves the house 10 business days to put together a deal that works for all is not so bad.

Alan~  So true.. one pie.. it's just how we cut it!

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Lori and Bruce... sometime to help the client we have to show them different ways of doing things and once they see the opportunity they might have in moving up in this market the motivation to sell does change.  This is the best time ever to be looking for a dream home!  Interest rates are low and selection is great... so take time and go through the process with less stress in a discretionary mode.

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

You are sooooo right!  Wow, nailed it.  Motivation is so the key!

Posted by Chris Alston, Silicon Valley, California (Chris Alston (Keller Williams Realty, Silicon Valley, California)) about 10 years ago

Hi Carra~  I have done deals with those kind of contingencies.  The are labor intensive, but most are anyway!

Posted by Vickie McCartney, Broker, Real Estate Agent Owensboro KY (Maverick Realty) about 10 years ago

Carra,

This is a great discussion, I love all the participation of the group.  It is a pleasure to be among such bright minds.

Posted by Ron and Alexandra Seigel, Luxury Real Estate Branding, Marketing & Strategy (Napa Consultants) about 10 years ago

Carra, It gets down to seller motivation. Are the sellers motivated to sell or to stay?

Posted by Jill Wente, Realtor, CRS, MCNE, CHMS (Better Homes and Gardens Real Estate | Gary Greene) about 10 years ago

Hey thanks for the good read today.  I'm gonna re-blog!

Patricia/Seacoast NH

Posted by Patricia Aulson, Realtor - Portsmouth NH Homes-Hampton NH Homes (BERKSHIRE HATHAWAY HOME SERVICES Verani Realty NH Real Estate ) about 10 years ago

Carra:  At least in the Chicagoland area, adding the fact that this is a condo in a complex into the already muddy waters, certainly increases the challenges that are possible to consider during the sale and processing of this property.  A real can of worms.  Would love to know how this scenario ends-up playing out.  It would definitely read like a "text book" case for all of us to learn from. 

Seems like I'm always enlightened by your posts and your work, Carra.  Keep us posted, please ... and Congratulations on being Featured!

Gene

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) about 10 years ago

Thank you for this!  We have an approved addendum to take care of the seller's property purchase contingency, but I had never heard it framed quite in that manner.  This will be very helpful in getting overpriced sellers to understand the needed price reduction that will enable them to move on.

Posted by Kristen Wheatley, Supporting Success - Best Job in the World! (Better Homes & Gardens | The Masiello Group) about 10 years ago

Chris ~  This idea can help some sellers get motivated and take advantage of the wonderful opportunities out there now!

Vickie ~  Labor intensive is an accurate description of how that works!

Ron and Alexandra ~  I love comments that create more discussion! 

Jill ~  Yes.. they must pick one!

Patricia ~ Thank you for the re-blog!

Gene ~ Thank you... and I met with the broker today and her seller sounded receptive.... it will be a great case study.. we will keep this one going!

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Kristen ~  Perfect.. win/win is what we are all looking for... just another way to look at putting a transaction together. 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Carra:  I kept thinking about your post after writing my comment ... and decided this was a post that as many people as possible needed to see and think about.  So ... I re-blogged.  I asked that all comments and questions be directed only to you, not me.  That way they get the best and most complete answers possible ... and you are aware of the interest you stirred.  Again, great post Carra.

Gene  

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) about 10 years ago

Excellent ideas Carra.  Not so easy to accomplish but it does work at times. On occasion we've had more than 3/4 closing stacked up - all contingent on each other.  Now those are 'scary' closing weeks.

Great re-blog!  Thanks!

Posted by Anna Banana Kruchten Arizona's Top Banana!, 602-380-4886 (HomeSmart Real Estate BR030809000) about 10 years ago

Isn't it the job of a real estate attorney to give a legal advice?

I am a little confused...

Posted by Joshua Zargari, MJ Decorators Workshop (MJ Decorators Workshop LI staging and home decorating) about 10 years ago

Carra...

I like the idea of limiting the condition to two weeks or something else that is reasonable for the local market. Interesting post.

Posted by Richard Weisser, Richard Weisser Retired Real Estate Professional (Richard Weisser Realty) about 10 years ago

I'm not quite sure how I feel about this one...if the seller wants to move, they will need to reduce the sale price anyway to get activity on it.  A good agent should be able to tell a seller upfront what their home will sell for, typically, or at minimum a range.  If the seller isn't cooperating on a reduction, what difference will a "conditional" offer make anyway?  To even get an offer they would need to reduce...maybe I"m not understand the post?  This seems like a whole lot of work to me.  

Going back to re-read, lol.

Posted by Elizabeth Cooper-Golden, Huntsville AL MLS (Huntsville Alabama Real Estate, (@ Homes Realty Group)) about 10 years ago

Gene ~  Thank you so much.. I think this idea is a tool to present to work with sellers from a new standpoint so it is a great way to create business if an agent has the time.  It all takes time!

Ms Anna ~  Thank you and you know it CAN and does work.. just connecting LOTS of dots!

Joshua ~  That is why the disclaimer is there... anything in a contract needs to meet the broker and or an attorney's approval.. You come from a state where attorney's are involved in all transactions so this idea should be run through an attorney to get the blessing.

Richard ~  They key to keeping the buyer is to find the replacement home quickly.  I used to take the seller shopping before we got an offer so they were familiar with areas, styles etc.. didn't want them to fall in love with anything but have the process going and loan pre-approved so when a buyer did come along they could work within the 10 day period.

Elizabeth ~  This is a way of getting a seller to get in the game with nothing to lose.. if they cannot make up the "Perceived Loss" on a price reduction on their home on the replacement home they don't have to sell...l but they do need to see if they can find a buyer by reducing the price.

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Hey young lady, you earned me another notch on my shot caller record. Congrats on the feature

Posted by Ed Silva, Central CT Real Estate Broker Serving all equally (RE/MAX Professionals, CT 203-206-0754 ) about 10 years ago

I will have to run this by my broker. Makes sense to me.

Posted by Robert L. Brown, Grand Rapids Real Estate Bellabay Realty, West Mic (www.mrbrownsellsgr.com) about 10 years ago

Carla,

Good points. Just a comment however. The conditional acceptance would not work in Ontario. But, a somewhat similarly worded option to terminate woulod.

By the way, that gives me a good idea for a post.

Brian

Posted by Brian Madigan, LL.B., Broker (RE/MAX West Realty Inc., Brokerage (Toronto)) about 10 years ago

This is interesting but I tend to like things much more clear cut than this. I find that if someone wants to do something, they do it. If they do not, all these escape clauses are the routes they are going to take anyway.

Posted by Cheryl Ritchie, Southern Maryland 301-980-7566 (RE/MAX Leading Edge www.GoldenResults.com) about 10 years ago

You have to have a motivated seller to get anywhere. Showing them comps isn't enough in this market when many sellers are seeing losses they never imagined. They need to know the how and why and totally see the transaction laid out before they get on board.

Posted by Steven Beam, Parker Colorado Real Estate (RE/MAX Alliance - Parker Colorado Real Estate.) about 10 years ago

Today's market can be frustrating for someone who wants to sell and buy, that's for sure!  You've given them some good avice.

Posted by Margaret Woda, Maryland Real Estate & Military Relocation (Long & Foster Real Estate, Inc.) about 10 years ago

This is great Carra, thank you. I have three sellers that will buy once their homes go under contract. They are ready to move once they sell and will buy right away or go to an apartment if they don't find something. We do have a closing date extension form but I have never had to use it from the seller's side till last week.

My first time home buyer was set to close June 30th on a new construction home which he went under contract prior to April 30th. We were all ready for the closing, on June 28th the builder filed for bankruptcy, gave no warning he was going to do this. It was crazy. Seller/builder did do the closing date extension luckily because we can't close until the bankruptcy judge gives the go ahead. My buyer luckily was able to stay in his apartment until we are able to close. My buyer stands to lose almost $9000 if this doesn't close ($8000 tax credit, $450 appraisal, $275 home inspection).

Sorry to stray a bit off topic but in this market it seems everyone needs to be a bit flexible if possible. Conditional sale clause is something to think about.

 

Posted by Debra Beagle, Managing Broker/Owner, CRS, GRI, ABR, CLHMS, RCS-D (RE/MAX Advantage) about 10 years ago

Carra: This is genious, and I am trying something similar right now with a client couple who are a little nervous.

Posted by Aaron Vaughn, REALTOR© 512-845-4204, My knowledge is your power | eXp Realty (eXp Realty) about 10 years ago

thanks for the tip....

 

great help and a new idea...

Posted by Vince McEveety (Gilleran Griffin Realty) about 10 years ago

Ed ~  There is something special about being a "notch" on your purple square :) Thank you!

Robert ~  Checking with your broker is where it should all start! 

Brian ~  Will look forward to reading your post!

Cheryl ~  This type of transaction is very difficult and not for everyone so many variables.

Steven ~  When dealing with this type of situation.. nothing is the same and a seller will not know what to do or how to respond until all the parts are put together.. so this is not for people who are not flexible.

Margaret ~  It is a place to start and gives a seller options which they did not have when the market was rolling at a different pace. 

Debra ~  You are experiencing all the things that have to addressed in most transactions today... the external forces!  This is just an idea to help those people get off the fence and into the greatest time ever to buy without feeling pressure.

Aaron ~  Let us know how things turn out! Glad to help plant some seeds.

Vince ~  Hope it can generate a new listing or two!  You are welcome.

 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Very informational. I have had these frustrations lately myself. 

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Posted by The 1410 Group of Benchmark Realty, LLC (Benchmark Realty) about 10 years ago

Carra~

Thank you for the time and energy you put in when writing this post. Congratulations on the Feature. You sure deserve it!

Posted by ASHEVILLE REALTY REFERRAL RESOURCE 828-776-0779, CONTACT janeAnne365@gmail.com ( REAL ESTATE REFERRAL NETWORK ) about 10 years ago

We see this in some listings around here. The issue can be if the new purchase is a short sale, and there are many around here.

 

I also think reframing is important for clients sometimes.

Posted by Christine Donovan, Broker/Attorney 714-319-9751 DRE01267479 - Costa M (Donovan Blatt Realty) about 10 years ago

I like to show sellers, especially the ones who are moving up, that what they lose on selling now is more than compensated by the killer deal we'll get on a newer and bigger home. I show the future appreciation for both homes, and I show how their payment and/or buying power changes with higher interest rates. The numbers don't lie, but are unfortunately not always enough to get sellers who are emotionally attached to what their home was worth 3 years ago to come to grips with reality!

Great post, I like the conditional approach, even if a little too complex for a lot of buyers & sellers (and many agents too!). This goes well with my numbers approach too!

Posted by Chris Browne (Trillium Realty Group) about 10 years ago

Many sellers are in this plight ! They're gonna take a hit in the sale that they must make up on the buy !!!

Posted by Michael J. Perry, Lancaster, PA Relo Specialist (KW Elite ) about 10 years ago

Hello Carra:

I paused a long time before leaving my comment.  My conclusion is that is is a very good post with a good tactic I have seen many times, but never called conditional marketing.  These are complex , tricky, transactions and everybody in the chain needs to know where the risks are.  If all are agreeable and willing to go down the road, all the better.

I actually like the pile of money example better. Showing a seller their true net indifferent scenarios is a valuable tool.

Posted by Brian Rugg, Sun City TX Real Estate - Georgetown, TX Real Est (Rugg Realty LLC Sun City Texas 512-818-6700) about 10 years ago

Thanks Carra.  Your tip will surely come in handy.

Posted by Maria - resale- condo - lease - buy-sell Reece - toronto & GTA homes and condos (Royal LePage Terrequity, Toronto - homes) about 10 years ago

Stephen ~  Lots of dots to connect!

JaneAnne ~  Thank you.

Christine ~  So glad to get your input from an "attorney perspective".  Yes, the purchase of a short sale as the replacement home might not be in the cards.. too many additional problems and would probably lose a buyer on the purchase end of the sellers home.. so all those variables come into the equation.  But working with a seller who is competing with the short sales could make sense as there are real live people ready to go when all the dots line up!

Chris ~  Excellent idea in the number analysis.. for those engineer type sellers that might work well because for anyone who does not think out of the box with "unknowns" this does NOT work!  Thanks for the idea and will implement that concept for those who need more specifics to jump in.

Michael ~  Perfectly stated!  That is what is happening.. we just put some lipstick on it!

Brian ~  You summarized it well "These are complex , tricky, transactions and everybody in the chain needs to know where the risks are. If all are agreeable and willing to go down the road, all the better."  All the players have to be on the same page of the play book, including the agents or it will NEVER work!

 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Maria ~  Hope the idea can get you a couple new listings and an opportunity to shop! 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Bookmarking this one! Thanks for the great ideas!

Posted by Dan Cronin about 10 years ago

Great idea......just what is needed to get the "thinker" off the fence.

Posted by Woody Edwards, A Realtor® Who Answers His Phone! (First Choice Realty, Inc) about 10 years ago

Dan ~  So happy to help and give different ideas!  I guess that is what doing it for 30 years will do for one!

Woody ~  It is a great way to get someone afraid to make the jump off the fence and feel in control.. they are in control and when they find the perfect home it will all work out.. guaranteed waves!  All our transactions have waves now.

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Very well written article on this issue and great approach to solving it.  I've had this discussion recently and made it clear to the client that there is an "opportunity cost" associated with not dropping the price of their current home and waiting for the ideal next home. 

Posted by Bryan Robertson about 10 years ago

Bryan ~ Seems like you might have the perfect opportunity to suggest the CONDITIONAL price reduction and replacement property to them.. then they make the decision of the new home they find and see if the financial pieces fit together.  Only they can decide what works for them but finding the right replacement home often times help them let go of the predetermined $ idea and moves the decision to the home. 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

This is an interesting idea.  However, a contingency for a buyer is almost impossible by itself, now we have 1 for the seller as well.  It could get pretty complex.

Posted by Jirius Isaac, Real Estate & loans in Kenmore, WA (Isaac Real Estate &TriStar Mortgage) about 10 years ago

Carla, this was very good. Thank you for sharing. Some time ago, I made myself a little list of creative ideas, I will add yours, and perhaps I should share my entire list.

In you four key factors, 1, 3, and 4 are closely related whereas 3. & 4. affect 1.; and play on each other more so than 2.

Posted by Richard Bazinet /MBA, CRS, ABR, Phoenix Scottsdale. Sellers, Buyers & Relocations (West USA Realty) about 10 years ago

Since I was first trained by my Broker, I started out being an order taker. I soon realized that I wasn't a professional Realtor, but simply a tool, so I left and started hunting for another Broker. The concept of integrity, value, marketing and strategies to deliver results to sellers and buyers became very clear to me as I was mentored by a professional.

So, I don't appease or manipulate people to get what I want just to get the business because my job is to provide the best solution to my client or future clients yet many are stubborn and unrealistic. As a professional, I simply walk away from those opportunities whenever there is conflict.

Everybody is entitled to their opinion, however, if you must take a conditional price reduction listing to get the business, are you looking out for your client, I think not?

Pricing the home to sell requires exposure and a compelling attraction for agents and buyers to inspect the property and that's called marketing. Location, features, value and price comparison.

Pros sell and order takers take over priced listings. Just my opinion, but true non the less. If the property is priced correctly, you wouldn't need to reduce the price almost immediately, wouldn't you?

Posted by Kimo Jarrett, Pro Lifestyle Solutions (WikiWiki Realty) about 10 years ago

Carra, boy does these post bring back some memories...thanks for the trip down memory lane; it reminded me of a situation that I had with sellers in the same boat...

Posted by Malik Crichlow, Maplewood,SouthOrange,Union Real estate (GoodBuy Homes NJ Essex & Union County Real Estate specialist) about 10 years ago

Very good post.  I think with some people the price is a pride issue.  However, showing them how they can obtain thier goal (new home) while accepting a realistic price is a good idea.

Posted by Gene Riemenschneider, Turning Houses into Homes (Home Point Real Estate) about 10 years ago

Hi Cara,  Interesting concept and you seem to be a very creative agent ! "Re-framing the way we think and understanding in today's market ..."

Posted by Bill Gillhespy, Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos (16 Sunview Blvd) about 10 years ago

Carra,

I do believe you need to be as creative as you can with out going over board sometimes. Sellers get into situation sometimes that need an out of the box agent to get it done.

Posted by Ron T. Weems Jr., Managing the details one home at a time. (Weems Property Group | KW North Sound) about 10 years ago

This is an interesting concept but I'm a little confused.  This started with a seller that could not sell because they were overpriced, so you suggested to the broker that they add a contingency to their listing?  I'm not sure how that's going to help, now they've still got an overpriced listing AND it comes with a contingency added, just don't see it motivating buyers to jump on this one.  But is an interesting concept, maybe if the scenario was different.  Thanks for the info.

Posted by Lori Ginter (HRC Properties, LLC) about 10 years ago

allll so good !!! true that !!

Awesome post Car a lot !!

Posted by GARY DIGIORGIO -Denver- Arvada -Westminster, REOptions LLC (THE DIGIORGIO GROUP /(303) 898 - GARY (4279)) about 10 years ago

3 things a re very important in RE sales Price, Price, Price.

Posted by Timo Yannopoulos, Buying and Selling Kansas City Homes (Platinum Realty Licensed in Missouri) about 10 years ago

Great presentation!! My favorite and most poignant statement of yours was....

"Re-framing the way we think"

It isn't just the sellers...it is us too.   Joy

Posted by Joy Carter & Jeff Booker Brother and Sister Team, Trust Your Family's Move To Our Expertise! (Keller Williams Parkland/Coral Springs Realty-GreatFloridaHomes Team) about 10 years ago

I have a Town Home Seller in the same situation.  I kind of used the same idea.  I like your phrases better.

Thanks for the blog.

Mark

Posted by Mark & Janelle Potter, Mark and Janelle Potter Realtors - Broadmoor Colo. (The Real Estate Network 719.331.4824) about 10 years ago

Wonderful Carra. This will go into my company sales meeting today.

Posted by Joe Manausa, Tallahassee Real Estate (Joe Manausa Real Estate) about 10 years ago

Great thoughts, Carra, definitely a 'gold star' post. Thanks.

Posted by Lottie Kendall, Helping make your real estate dreams a reality (Compass) about 10 years ago

Jirius ~  Yes, this is VERY complex and not for everyone. 

Richard ~  You are exactly right! 

Kimo ~ I am sorry I am not sure how the communication broke down but this idea is not about manipulation and keeps the seller in complete control... I even suggested that the agent remind the seller that they should NOT sign anything if it does not meet their expectations. Not every seller is willing to reduce the price without some reservations..... this allows the agent to work through the price concern    allows a seller to go forward with NO risk.  The BIG risk is actually for the agent and the time that is spent negotiating offers that might NEVER go together.  So if you read the post over you will see it really is in the best interest of the seller who also is a buyer in the same transaction who might not understand how important PRICE is for the marketing of a home.    Just re-framing the pricing concept of selling a home.

The video below is an example of a seller/buyer and how he used this concept on a move from LA to AZ and what he felt about the transaction.  It might clear up the concept for you

http://www.youtube.com/watch?v=J_4Kgybb9DA

Hope this clears up any concept of any agency or real estate profession issues. The idea is about helping a seller become comfortable with looking for a replacement home by "trying a conditional price reduction."

 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Carra...Some Wonderful Ideas for continued Success....how are we going to sell someone's home if they're not committed? 

To Your Continued Success!

Posted by TODD PICCONI 909.908.7376 PASSIONATE ABOUT YOURMOVE, Patient, Persistent and Passionate About Your Move (TODD PICCONI REAL ESTATE) about 10 years ago

Malik ~  I hope it was a good trip and that you had success in helping a seller find their dream home!  That is what it is all about.

Gene ~  Our job as an agent is to help a seller or a buyer achieve their housing goals don't you think?  This is just another "conditional" way of helping them do that.. where they are in complete control with no risk.

Bill ~  Thank you.. after 31 years of selling this concept was just normal for me.. kept everyone at ease and I knew it would work out in the end with patience and understanding for all concerned. 

Ron ~  This is out of the box for everyone.. including the agent as the risk of investment in time is all on the agent. 

Off to the airport.. back in a couple hours!  Thank you all for such great comments.. More later :)

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Lori ~  Sorry for the confusion.. the point is to take a price reduction AND add the contingency.. then you no longer have the overpriced listing but it is contingent upon the seller putting together a deal they like on the buying end meeting all their expectations.. to their satisfaction or they do not proceed with the sale.

Mr. Gary D ~   You sir, have been doing this type of sale for years too! It does work and everyone is happy if all parties are on the same page working to a collective end which is win/win for everyone.

Timo~  you are SOOOO right!  Getting to the right price!

Joy ~  We all have to wrap our heads around new ways of thinking about things.

Mark~  Great to hear!  Let us know how it turns out!

Joe ~  So happy to hear it is something you would like to pass on as a broker!  I have found that this really does help a seller get to where they want to go without the FEAR... it takes TIME on the part of the agent and risk so it all goes into the business planning part of our work.

Lottie ~  Thank you so much!

Todd ~  We won't sell their home if they are not committed!  It's all a risk in the form of time but the seller is protected if they do not find their dream replacement home.

 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Sellers have to face reality with price to make things happen.

Ty

Posted by Ty Lacroix (Envelope Real Estate Brokerage Inc) about 10 years ago

Ty ~  Price really is the key and "conditional marketing" is a way for the seller to control the transaction by making any sale contingent upon working out a deal on the buying end. 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Carra,

Brilliant!  Invaluable information for a seller in todays market.

Posted by Maya Thomas, Broker, Please see my client recommendations. about 10 years ago

Maya ~  It is also a helpful tool for an agent to gently help a seller see if they can find their dream home.

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

That sounds like our "contingent" listings, which seem to be very unpopular because the Seller has too much control.

Posted by Jim Frimmer, Realtor & CDPE, Mission Valley specialist (HomeSmart Realty West) about 10 years ago

Jim ~  Each seller and buyer are different in wha they need.. the good thing is there are a alot of choices so they can wait till they find the person who loves their home and will wait for them to find a replacement.  This does NOT work for everyone... so it's just an option to see if a transaction can be put together.

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) about 10 years ago

Interesting approach Carra. It's worth a try if nothing else is motivating the Seller.

Posted by Wayne B. Pruner, Tigard Oregon Homes for Sale, Realtor, GRI (Oregon First) almost 10 years ago

Tigard ~  It does not hurt to try new ideas! 

Posted by Carra Riley & Declan Kenyon, Helping people Transition at all ages! (Brokers Guild Cherry Creek Ltd) almost 10 years ago

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