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Is it True a Sacramento Listing Agent Must Present all Offers?
An agent asked last week what he could do when a listing agent in Sacramento refused to present an offer to the seller. Well, he could print out a photo of that listing agent’s mug, draw devil horns on the head, tack the picture to a wall and throw darts at it. That’s one solution. He could also report the listing agent to the Board of Realtors and the Bureau of Real Estate. It’s a violation to withhold an offer. Listings agents are required to present all offers to the seller upon receipt or as reasonably as they can thereafter. It doesn’t matter if the home is already pending, either. An offer comes in, that purchase contract has gotta go to the seller.
A listing with an “active short contingent” status is especially suspect because that status, by its very nature, attracts offers. Agents who refuse to present offers or say no offers are accepted for an active short contingent status in MLS can find themselves fined by MLS as well for violating its guidelines. However, listings of any status are not exempt from a listing agent’s duty to present all offers.
It also doesn’t matter if the purchase offer is written on a roll of toilet paper, the listing agent must deliver the offer to the seller. Real estate agents don’t have the ethical nor legal right to decide which offers the seller gets to see and which can be withheld. Not our decision. But you’d be amazed at how many Sacramento listings agents don’t understand this simple procedure or were never informed of its necessity.
Something else some buyer’s agents don’t realize is the rejection on page 8 does not need to be initialed nor signed by the seller. It is not required. If the seller rejects the offer, no signature is necessary. The listing agent is not required to return a page that shows the seller has rejected the offer by an initial or other acknowledgement. It’s only a courtesy.
An email from the listing agent to the buyer’s agent detailing the outcome of the offer is sufficient. If buyer’s agents try to demand a written rejection by the seller, basically they’re saying a) they don’t understand how purchase contracts work, and b) they don’t trust the listing agent — neither of which is likely to endear them nor their buyers; it’s just stupid and insulting.
If you suspect an offer was not presented to the listing agent, the first step is to ask your buyer’s agent or manager to speak to the listing agent’s managing broker. Brokers are responsible for the actions of their agents. I’d say that most listing agents in Sacramento realize they must present all offers and comply. It’s unusual for the opposite to happen. But bottom line, if you’ve irritated the listing agent, it probably doesn’t really matter what else you do. A complaint will just bring personal satisfaction and help to raise the bar. It won’t get your offer accepted. That’s the real world part.
A Listing Agent Explains All Home Selling Steps
Sacramento real estate clients rely on their agents to explain what’s going on in a transaction and the next home selling steps, even if the clients appear knowledgable. Because an agent never wants to disappoint a client or fail to keep a client informed. Even at the risk of being overly simplistic, it’s important to communicate and inform. I realize that agents don’t want to insult their clients, but clients are insulted if they don’t understand, take your pick.
Not to mention, every home seller has her own perceptions about how she believes things work.
Earlier this week for example I was talking to a seller about putting a sign rider on the post outside that says: Don’t Disturb Occupant. I often put up sign riders like this on vacant homes to try to dissuade the thugs who break into them, but I also use those riders for occupied homes in some areas. The seller said she didn’t need that sign rider because if anybody approached her doorstep with evil intentions she would shoot them. This astonished me, mostly because the seller was old enough to be my great grandmother. I asked if she had a gun. Her response was yes, everybody has guns.
Well, no, I don’t own a gun.
Regardless of how many homes this seller might have sold in her life or how much she might know about home selling in Sacramento, I still explained every step of the transaction to her; fully cognizant that I may need to repeat the steps later on. I try to imagine what is likely to happen in a real estate sale and then I share that knowledge with my sellers.
One of the worst things that could happen to me as a real estate agent is to have a seller wonder what comes next and not know.
Well, I guess I could be shot.
The Best Sacramento Listing Agent Asks Questions Like This
It’s a sorry state of affairs in this real estate market when a Sacramento listing agent holding a pending offer questions another agent with a pending listing to inquire if her sellers are in contract with the same buyers. Yada, yada, yeah, it’s confidential information but agents can still confirm the fact. I’m just saying it’s sad that an agent nowadays is put in the position of having to ask the question in the first place. It’s part of doing a fiduciary for the seller.
Sure, most transactions are straightforward and everybody is honest and ethical. Unless they are not. I’ve run across so many screwball escrows lately that my head is practically spinning. There was the guy who tried to buy a home and actually finagled his way into a contract when he had no money, no job and a police record. Then, there were the many buyers who wrote multiple offers all at the same time, locked down the properties and then subsequently canceled them all. Not to mention the cash buyers whom, at the last minute, developed cold feet.
There are so many ways that working with an experienced agent in Sacramento can pay off for a seller that I can’t even count them. Because of the volume of business that I do, I see a tremendous amount of purchase offers pass through my computer every year. I pay close and careful attention to each one of them, too.
Somebody asked me the other day, a seller whose home I’m listing next month, if I was too busy for her. I don’t know if she got that idea from a competing listing agent or if she came up with it on her own, but I am never too busy, and that’s the secret to my success. I don’t take on more listings than I can handle. Like I replied to this seller, a while back I was handling 70 to 75 listings at a time and doing a damn fine job if I say so myself. My clients agree, too. Today, my active Sacramento home listings number closer to 25, because the market is much slower.
The thing is I use my 40 years of experience to help my sellers. That’s an inherent quality they can’t buy or easily find elsewhere. My clients expect me to go beyond the norm. If I receive paperwork that makes me ask questions because I spot a red flag, you can bet I will get to the bottom of it. I see that action as part of my job and in good conscience I cannot let these types of questions go unanswered.
How to Profit from a 50% Pending Home Sales Fallout in Sacramento
It pays today to be a home buyer on a backup offer in Sacramento since we seem to be experiencing such a high cancellation rate on escrows; in some cases up to 50% of the pending sales are falling out. I say this not to be an alarmist but to point out what other real estate experts are too frightened to bring up because they are worried this kind of data would harm our fragile sales market. Every real estate professional, just about, knows this is happening in the Sacramento real estate market, if they’re doing any kind of business. They’re just not talking about it.
That’s because we have to be positive and spread only good news about Sacramento real estate. Oh, spittooey. You’ll read in other news media that sales are UP. What media is not telling you is real estate sales naturally increase in the spring. Inventory is low, which is true, inventory is low as compared to previous years, but it doesn’t matter because there aren’t enough buyers for it. Home buyers today typically lust over only the best home on the block and the rest are ignored.
On top of this, buyer’s agents think they are working with buyers because buyers tell the agents they are buyers. They might even pop up with a pre-approval letter in possession. But it doesn’t mean they are a buyer, because a buyer closes escrow and eventually ends up with a home.
It’s not the end of the world if an escrow cancels, because it will generally turnaround and go back into escrow again under a second purchase contract within a relatively short period of time, but that’s why you want to be a backup buyer, if you can. Don’t think you can’t write a contingent offer, either, if you have a home to sell, because sellers are accepting contingent to sell offers from buyers.
For other listing agents, my advice is don’t put that listing into pending status until the buyer has deposited funds into escrow, which should occur within the 3 days MLS gives us to change the listing status. Because nobody wants to deal with the unfair stigmatization of a back-on-market listing because some doofus buyer on a whim canceled the escrow.
For buyer’s agents, don’t write multiple offers when your buyer can’t afford to buy each of those homes. Not only is your reputation as a Sacramento real estate agent at stake, but those types of “buyers” can easily morph into a vanishing act after both offers are accepted. If your buyers really want a pending home, consider writing a backup offer.
For buyers, get over the fact that homes might cost $100,000 more today than they did 3 years ago. Those days are gone. But prices are still low as compared to the prices pre-market crash. Don’t wait for interest rates to go up and slowly rising prices to price you out of the Sacramento real estate market all together. Get in while the getting is good, and for heaven’s sakes, stay there.
How to Sell a Home in Sacramento Fast and Close Under 30 Days
A seller who lived a ways north of downtown Sac called last month to say he needed to sell a home in Sacramento fast, because he had just accepted an unexpected job transfer and had to move across country in 30 days. I love challenges and thrive on those types of opportunities. This couple had purchased the home a few years ago as a bank-owned home and were worried about disclosures and condition. They also were located in a small pocket of newer homes, nestled in a subdivision just down the street from what Bob Dylan might call Desolation Row.
As with any potential listing, I point out the positives and I don’t gloss over the negatives with my sellers. Both carry weight with a buyer, and sellers need to look at the sale of their home from the eyes of a buyer because that’s how homes sell. Sometimes sellers are worried about the tiniest things that carry no consequences of sale, and sometimes they overlook the major things that are really a big, big deal. That’s where a veteran Sacramento real estate agent can be a huge help. I share what sellers need to do and what they don’t need to do.
What these guys needed to do was clean up the house and keep it tidy. Mow the lawn. Clean out a few pieces of furniture. No repairs, no fixing anything except one loose cabinet door in the master bath that required a screwdriver to straighten up. Then, cooperate with showings, no matter how crazy it made them for a week.
We discussed the comparable sales, all of which were pretty much brand new homes. Their home was resale, older. Big difference. However, there wasn’t much on the market, either, and they had desirable factors such as four bedrooms and it was a sought-after single story. They priced it at the hottest price point in Sacramento for this type of home, and we let the market dictate.
The market responded favorably. I personally contacted every buyer’s agent after a showing. We received many offers and accepted the offer from the strongest buyer at the strongest price, which wasn’t necessarily the highest price, but it was 5% over list price and in line with the new home sales. We held our breath as I talked with the buyer’s appraiser and whammo, the appraisal came in at the sales price. You couldn’t ask for anything better than this.
Probably the best part was the home sold and closed in fewer than 30 days, even with marketing time. The buyer’s lender was able to quickly perform. The seller signed their escrow documents while packing in the convenience of their own home. As they drove across country through the cornfields of the Midwest, a wire transfer deposited the proceeds of sale into their banking account. The seller texted: “You are the best; we will never forget what you have done for us.” Peace of mind is priceless. But money helps.
