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Does Seller Motivation Mean No Regrets After Listing a Home?
Seller motivation is important in any Sacramento real estate transaction and extends beyond an urge to sell a home. It extends all the way to closing. Seller motivation means many things, though. When buyer’s agents ask me if my seller is motivated, they are asking if my seller will accept a lower price for her home, and the correct answer to that question is: I send all offers to the seller. A listing agent who responds without permission: heck yeah, let’s negotiate, could be guilty of violating her fiduciary duty to the seller.
Sometimes I spot listings in MLS in which the listing agent has entered that phrase into confidential remarks, the seller is motivated. This may cause a person to think to herself: sure, of course the seller is motivated because the seller has his home on the market, right? Followed by well, there is the matter of the home being priced $100,000 over market value, so that sort of extinguishes the flames of seller motivation right there. In those types of cases, seller motivation might be a secret code to buyer’s agents, letting them know the agent is aware, say, of overpricing, but can’t say so.
Sellers often don’t want to reduce the price because they expect a buyer to negotiate. They fail to understand that buyers really don’t want to negotiate. They cannot wrap their heads around that fact because they are too stuck on the mentality of being a seller. In cases of homes priced too high, buyers often just skip them.
There is also seller motivation that backfires and turns into seller’s remorse. This tends to happen when a home quickly sells or at a higher price than the seller anticipated. The flurry of marketing activity, preparing the home for the market, surviving buyer showings and open house traffic can shift the focus from moving out to getting ready to sell. When the purchase offer arrives, it can cause shock, especially when the seller typically needs to sign within a 24-hour period. A seller can feel pushed. Aggravated.
Harried, exhausted, irritated and feeling like always running a day behind can cause seller’s remorse. It’s not unusual for a seller to question whether he or she has done the right thing by signing a purchase contract. Often this feeling of uncertainty will pass if they just give it a little bit of time to settle in. We all do not process data in the same way. This is why it’s more important now than ever to establish and review your reasons for selling a home before putting your home on the market.
I try to spend a sufficient amount of time with prospective sellers before I take a listing. I met with two different sellers on Friday who are not yet ready to sell their homes. One seller lives in Elk Grove and the other in a 1920’s brick bungalow in Midtown Sacramento. It was easy for me to ascertain that the time is not right because I asked the right questions. The last thing anybody needs is an unexpected upheaval in her life or feeling coerced into signing a listing agreement. I have plenty of patience and compassion. When you’re ready to sell your home in Sacramento, I hope you will call Sacramento Broker #00697006, Elizabeth Weintraub at 916.233.6759.
No Guarantees in Sacramento Real Estate for a Seller
It seems that Sacramento sellers are wanting a lot of guarantees in a sale these days, some of which they just can’t get. That’s a recipe for a few frustrated sellers. For example, I’ve had sellers tell me they want 100% assurance that the buyer can get the loan. Well, I’d like to be 29 again, too, but it ain’t gonna happen. OK, maybe not 29, maybe 39 instead. Yeah, like Jack Benny and 39. A perpetual 39, never a day older.
We can get a preapproval letter from a lender, and we can do all the due diligence possible about that letter, but it’s still not worth a damn thing. Lenders are not required to guarantee that the buyer can get a loan. Some of them don’t even run credit reports, if you can believe it, and I do because I see this sort of thing all the time. Many don’t even complete a loan application, because it’s too much work for a buyer who might never get an offer accepted, or whatever.
We can demand a DU (desktop underwriting) but even that is not a guarantee. It will disclose FICO scores, but that doesn’t mean that one of the parties doesn’t have a lien filed against her or an ex-husband has had a foreclosure in the past or that a buyer won’t lose his job midstream. Anything can and often does happen during escrow. Buyers change their financial situation and ruin their chances of buying a home, all on a whim, as they seem to undergo a temporary lapse in judgment. But it was so pretty, sparkly, dangly, fast, sleek, new, modern, um, they forgot. Oops.
I recall a couple of sellers who demanded that I lay out for them every situation that could possibly affect them during the term of escrow. What? Do you want to sleep at my house while I do this? Then, they asked if I would recite line-for-line each page of the 10-page purchase contract and explain each sentence as though I am a lawyer. In the middle of another escrow, sellers decided they no longer cared for the buyer and asked to replace the buyer with a new buyer, as though I have the power to magically unwind a contract. Abracadabra. I do my best to anticipate problems and head them off before developing, but I can’t possibly predict every scenario that could pop up during escrow.
Some things are surprises because, well, they are a surprise.
Like when a buyer drops dead. I don’t always expect that to happen. But it does.
But I know what it is. It’s fear. It’s fear that sellers are doing the wrong thing or making the wrong call. If one little problem pops up, there are sellers who will try to find a way to pin it on the listing agent. And that’s OK, really. You could pin a tail on this donkey, and I wouldn’t feel it. I don’t force them to take responsibility for their own actions. I’m not their mother. My job as a Sacramento Broker is to move them from Point A, which is putting the home on the market, to Point B, which is to closing and pocketing a big ol’ wad of cash in the seller’s bank account — at which point, they forget all about the drama.
I can’t guarantee that nothing will ever go wrong, but I can promise to try to fix it.
Call Elizabeth Weintraub, Broker #00697006, at 916.233.6759.
Conflicts After Closing a Sacramento Home
There are some business relationships you never want to end because they are so much fun, especially when everybody in the escrow is happy and excited, and then there are the oddballs . . . well, we won’t go there. Those are few and far between, though, because I’ve been a lot more selective of with whom I decide to work in Sacramento real estate, because there is only one of me to be pulled in a dozen different directions. I strive for no conflicts during escrow and prefer no conflicts after closing a Sacramento home.
I generally go out of my way to help my clients after the escrow has closed. Sometimes they want to know if I can recommend any tradespeople or vendors, and I’m happy to share personal recommendations along with the caveat that their experience might be different than my experience.
Sometimes they want to receive a copy of their closing papers that they’ve misplaced, and I will gladly provide those documents to them, either via email or snail mail, whichever is their preference. Or, they might just have a question about types of home improvement projects they might tackle and whether it would add resale value down the road. I love to talk about home improvement projects almost as much as I love selling Sacramento real estate.
But then there are the calls and emails from other real estate agents who have some kind of pressing dilemma, a conflict after closing. Often it’s the former buyer’s agents who received the initial call from their previous buyer. And the nature of this call tends to fall along the lines of there is some kind of defect or problem the new owner believes the seller withheld or failed to disclose. Naturally, the new home owner expects her buyer’s agent to pursue the situation with the listing agent, and they want the listing agent to involve the seller and resolve the issue.
Yet, that is not how it works, I’m sorry to report. After the escrow closes, the listing agent no longer has a fiduciary relationship to anybody in the transaction. She is not allowed to practice law without a law degree. A Sacramento REALTOR just can’t get into the middle of conflicts after closing because that is best left to the parties themselves to resolve. It’s not that the listing agent doesn’t care; it’s that she can’t offer legal guidance. After the escrow closes, her job is finished, and she’s no longer a hired gun.
Call Elizabeth Weintraub, Broker #00697006 at 916.233.6759.
What if Sacramento Real Estate Sold and Closed in 3 Days?
What do you think would happen if you could buy a home in Sacramento and close within 3 days? Wouldn’t it be sorta cool if we could demonstrably alter the way Sacramento real estate is sold and buyers did all of their due diligence upfront, meaning they came to the table with an appraisal and underwriting approval? Back East, buyers often conduct a home inspection prior to contract ratification. This idea isn’t so far fetched.
You can buy just about any kind of product, even an illegal product from overseas, and receive it within 3 days. If you were to refinance a mortgage, that takes 30 days generally, but even when all is said and done and they are ready to close, that’s when they are required by law to ask a borrower: are you sure? Are you really, really sure you want this loan? Because we’re gonna give you 3 days to change your mind and rescind.
Yet in our neck of the woods to close escrow on a piece of Sacramento real estate, we enter into 30-day escrow periods, sometimes longer when underwriting is said to drags things out — but a delay is often not due to underwriting but because the mortgage loan officer (MLO) did not carefully scrutinize the loan application at inception or possess enough experience to predict the problem. I see some situations that never should have progressed to the point they made it to if the MLO had been more competent, but I digress.
Back to closing Sacramento real estate within 3 days. It would add certainty to transactions and definitely reduce the number of cancellations. Of course I’m looking at this solely from a seller’s perspective and how anxious sellers become when a purchase contract is signed, but then they go through 30 days of uncertainty and anxiety, never knowing whether the transaction will close. Buyers have 10 ways from Sunday to cancel a contract. They don’t even have to sneeze and trip over their own feet. They can just cancel.
Part of the reason home buyers cancel is because they’ve had too long to think about buying that home. Why, if they only had 3 days before they were in their new home, sitting back on the sofa and putting up their feet on the coffee table before the realization hit: What in the hell did we do? Well, it would be too late. For more thoughts, call Elizabeth Weintraub, Broker #00697006, at 916.233.6759.
In Defense of Multiple Offers from Sacramento Home Buyers
The biscuit recipe for Sacramento home buyers that is guaranteed to drive multiple offers in the Sacramento real estate market goes like this: add 2 cups of a highly desirable home in the right location, perfect condition and priced well, toss in a pinch of salt representing all of the other homes for sale in that particular neighborhood (none), stir in 2 teaspoons of pending sales, cut in a stick of low interest rates and blend well with a cup of eager Sacramento home buyers. Drop on to a Sunday open house and bake at 400 degrees for 15 minutes — within 2 hours they’ll be history.
Our Sacramento real estate market reflects low inventory, low interest rates and a high demand from buyers. Sacramento home buyers, who often say things like: I don’t want to be involved in a multiple offer situation. It makes me wonder what they mean. Do they want to buy a home that nobody else wants? Some ugly dog that is overpriced and under-loved? Is that it? Because there are some of those homes for sale in Sacramento, and nobody is trying to buy those homes. The field is wide open for that kind of home. No competition for that stuff.
Don’t they want to be the winning bidder for a home that everybody drooled over but only they were smart enough and lucky enough to win? One thing is for certain when a home buyer goes into contract in these situations: when the time comes to sell that home down the road — maybe not next year, maybe not in 10 years, but eventually when that buyer turns into a seller — that same intense interest from buyers will still exist. The home will hold its appeal. Your hair might start to turn gray by then and your body might run off southbound, but that home will still be alluring, even after the Sacramento real estate market cools.
That extra $5,000 or whatever a multiple-offer might cost, can be the difference between owning a home or not owning a home. Think how less important that will seem 5 years, 10 years from now. Sure, your emotional conscience might be fighting a losing battle by telling you not to pay more than list price, but what if the list price is low to start with? Listen to your logical, rational side. What do the comparable sales reflect? Because remember, the home will most likely still need to appraise. It matters less what the list price is and matters more the value of the home.
And let’s not forget about appreciation. Home prices are on an upward swing right now.
I also wonder if “I don’t want to be involved in multiple offers” means the buyers intend to lowball the sales price and realize they can’t possibly win with that strategy when other buyers are offering more than list price. Of course, if that’s the case, they are not buying a highly desirable home in the Sacramento real estate market this spring.
I’ve heard agents say they think sellers are greedy when multiple offers occur. As though somehow it is the seller’s fault for maintaining such a beautiful home in pristine condition. It’s not the sellers who are driving the marketplace; it’s the buyers. Buyers establish final value. My advice is don’t worry about what everybody else is doing. Focus on yourself. Write your best purchase offer and call it a day. Don’t wander about wondering “what if” . . .
