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Sacramento Home Buyers Ask: Why Wasn’t My Offer Accepted?
It pains me when I see a purchase offer to buy a home arrive in my email and I instinctively realize the buyer will be asking her agent: why wasn’t my offer accepted? In the mind of many Sacramento home buyers, they did everything right. This particular home buyer found the home she wanted online all by herself — it fit her parameters exactly. She fell in love with the photographs and knew before she ever stepped foot inside that house that she wanted to buy that home.
Visiting the home in person solidified those feelings and thoughts. Yes, she should definitely buy that home. She is qualified and has her pre-approval letter that confirms it. The buyer may have provided proof of funds from her checking account. She has delivered an earnest money deposit with her offer. Everything is as it should be. All the stars are aligned, and this is her home. She even offered list price. She did exactly what was asked. All that’s left to do is to figure out where to put the sofa.
Ack. The seller accepted a different offer. Why didn’t she get this house? Why did the seller reject her offer? What is wrong with her Sacramento real estate agent? These are the thoughts running through the buyers’ mind. Do you want to know what the problem is?
First, it’s probably not the real estate agent. I imagine the real estate agent told the buyer that Sacramento is experiencing a limited inventory market, there is not much for sale, and there is intense competition, especially for entry-level homes in good condition. This means many Sacramento home buyers must write a better-than-normal offer. It could entail a higher price, paying more of the closing costs or giving the seller extra benefits, among other home buying offer tips.
I know that buyer’s agents explain this to their Sacramento home buyers. But somehow, that advice seems to fall on deaf ears or for some other reason the buyer does not agree nor understand. An agent can tell a buyer they need to offer more than $300,000 for that listing at $295,000, and some buyers will still ask, can I offer $250,000? These are not true buyers who say those sorts of things; these are people who are mentally deranged, which means yes, they are buyers from another universe and don’t operate in our world.
Working with a veteran real estate agent can also help improve a buyer’s chances of getting an offer accepted. Listing agents know the agents who perform and agents gain a reputation in this industry — good reason not to rely on your cousin’s aunt who happens to have a real estate license.
It’s generally one of three reasons why a buyer’s offer is not accepted: the buyer or the agent or both. Which is your reason? Because it’s not the Sacramento real estate market. We all must adjust to the market. If a buyer conforms to the market, the buyer will get her offer accepted.
Not Every Sacramento Home Seller Wants to Deal With a Counter Offer
When an agent says to me, you can always issue a counter offer to my buyer, that sounds like code for: the buyer is unreasonable, because I don’t think an agent is trying to tell a veteran how to sell real estate. But you never know in this market. We have a very weird market in Sacramento right now made up of serious buyers and squirrelly buyers and lowballing investors. I never know on which the roulette ball will land, as it is like a roulette wheel.
I can share with an agent that we have multiple offers, and yet the buyer’s agent will send me an offer that is contingent on selling the buyer’s home without a Contingency of Purchase addendum, much less a pre-approval letter. You can’t make this stuff up. Oh, and on top of it, maybe the agent hasn’t shown the home. It makes you wonder if buyers aren’t thumbing through MLS listings like a Neiman Marcus catalog and saying when I win the lottery, I’ll buy this house and that house and that house. And agents are writing offers for these guys. Blows my mind.
Most sellers in Sacramento do not enjoy bidding wars, believe it or not. They hope that a nice family will purchase their home at a fair price and close escrow — live there happily ever after. That’s what sellers want. Not every seller will want to deal with a counter offer. It’s stressful for many sellers. Negotiating does not come as easily to some of us as it does to others.
Myself, as a top-producing Sacramento real estate agent, I negotiate daily for a living, and I love to negotiate. But I’m also sensitive enough to realize that many of my sellers do not want to negotiate. They don’t want to deal with counter offers and all that they imply. They just want to sell their home.
If we receive 5 offers, the sellers, more likely than not, will take the path of least resistance and choose the best offer for them. Especially if it doesn’t involve a counter offer. If you’re thinking about writing an offer for a home in Sacramento, you should ask your buyer’s agent to call the listing agent to discuss what you might want to do. Although a listing agent cannot and should not ever speak for the seller, a listing agent can help to guide. You might have to write your best offer and stop trying to ding around.
On top of all of this, no offer should ever land on a listing agent’s computer without an advance call from a buyer’s agent. Not in this Sacramento real estate market.
Don’t Make This Sacramento Home Seller’s Mistake
Nothing speaks louder than real-life stories of home seller’s mistakes in Sacramento real estate and, in some cases, it’s pretty tragic. Further, being an optimistic person who tends to focus on just the good stuff, I don’t ordinarily talk about the home sellers who “go south” (no offense to you Southerners) but sometimes the stories ought to be expressed.
I share this particular story in hopes that some other home seller in Sacramento will be spared. First, let’s set some misconceptions aside. In today’s Sacramento real estate market, often the first offer is the best offer you’ll ever get. You should negotiate with that offer and not shrug it away because you didn’t like the sales price. Sellers can harbor futile hopes that another buyer will pay more but that and a quarter won’t buy a Starbucks. The first offer you receive might be the only offer you will get.
Second, after you hire the best Sacramento real estate agent you can find, you should stick with that agent. Don’t listen to those who will try to persuade you that you can pay less and get more. Where in the world does that philosophy work? You tell me because I’ll go to that store. There is always a tradeoff.
A seller begs to go on the market. Needs to sell because she is getting a divorce and cannot afford the house payments. She has equity. The problem with her home is she bought it thinking she was moving into a certain neighborhood, a desirable neighborhood but, for whatever reason, she was misled. She bought a home in a neighborhood that was not so desirable, yet still close to the more popular area.
These types of homes on the outskirts are very difficult and challenging to sell at prices within the skirts. Although an appraiser who is unfamiliar with the neighborhood will use comparable sales in the more desirable area, buyers often won’t make offers in that price range, and therein lies the problem. Besides, there are real estate agents who know the boundaries of neighborhoods, even if the buyers do not. A home on the outskirts could be worth $25,000 up to $100,000 less than other homes located within that 6-block radius.
This seller received an offer that would have paid off her mortgage, all of her closing costs and give her a little pocket change. She refused the offer. She was indignant. A short while later, she asked to cancel the listing. Big home seller’s mistake. I will always cancel a listing for a seller, though. I am not one of those agents who hangs on to the listing with her teeth and makes everybody angry. I just let it go. Besides, people have their reasons. Maybe they no longer want to sell. Or whatever.
Which is what this seller told me. However, soon after the listing was withdrawn, it was back on the market with another agent. The seller said her ex-husband wanted to hire a different agent, but it was difficult now for me to trust anything she had to say. The relationship between a listing agent and a seller is a fiduciary and built on trust. If the trust is gone, the relationship does not exist. She also mustered the nerve to ask if I would give her my photographs because she did not like the photos taken by her new agent. What?
In any case, her home is now pending as an approved short sale. She could have walked away scott-free but chose this path herself. It makes me wonder why people do this. I take no pleasure in her misfortune. In fact, it breaks my heart. I hope it never happens to you. Because you know what they say, you can learn from your own mistakes, but it’s much better to learn from somebody else’s. Don’t make these kinds of home seller’s mistakes.
Turning a Rejected Offer into an Accepted Purchase Offer
The thing with being unequivocally direct with people is they might think you have *Asperger Syndrome when you don’t. I suspect many successful Sacramento real estate agents display a bit of those symptoms, so it might not be as unusual as one may suspect. Symptoms such as extreme focus on the job at hand, set rituals and methods of doing things, on top of leaving people to sort out the fact that you just hit them between the eyes with the direct truth, can leave others somewhat puzzled. Not everybody appreciates candor.
Sometimes, I use candor in a playful manner, just to joke around with people, but fortunately I’ve got enough social skills to figure out it’s not always appreciated. Is it funny if you make a joke and the other person doesn’t get it? Does a tree fall in the forest? But I generally don’t blurt out NO, for example, to another real estate agent without offering a solution or alternative.
I’m of the mindset that NO doesn’t always mean NO, except in certain circumstances and we all know what those are: such as NO I will not listen to Neil Diamond sing Cherry, Cherry one more time! When a seller tells me NO, the seller does not want to accept an offer, what the seller is saying is YES, the seller would like to sell the home but the purchase offer that is set before her is unacceptable and needs to be altered. It needs to be presented in a different manner.
Yet, so often buyer’s agents will take that NO answer and wander off defeated. What some of them fail to appreciate is they are working with a buyer who wants to buy that home. And guess what? I am working with a seller who wants to sell that home. You would think, wouldn’t you, that between two real estate agents we could figure out how to bring together both parties and put that purchase offer into escrow? Isn’t that what a real estate agent is supposed to do?
Despite what some real estate books might say, we are not mere messengers here to carry out the wishes of our clients. Sellers who prefer to hire an agent who will work in that manner might want to enlist the services of a discount agent, an agent who will plop the listing into MLS and let the seller do the rest. When a seller lists a home with me, I presume the seller wants to close escrow on terms agreeable to the seller. It’s my job, as a full-service Sacramento real estate agent, to make it happen.
*Note: If you want to watch an interesting new crime show on FX about a police detective in El Paso who happens to perform at a high level with Asperger Syndrome, check out The Bridge.
