By Linda O', Owner/CEO, RE/MAX Leading Edge
Aunt Ethel made a delicious chocolate cake for dessert, and we’ll all have a chance to have a piece after dinner. But by mid-afternoon along comes a hungry bully who makes demands, screams loud and pounds her fist for the whole cake because she just can’t wait. Aunt Ethel caves to the pressure. Now nobody else is going to get a piece of cake.
And that is what is going on in our hot real estate market every week. An agent puts a new listing in the computer on Wednesday and states in MLS that the Seller will review all offers the following Tuesday at noon.
That cake bully Buyer comes along and wants her cake (property) NOW! She demands it and is willing to pay extra for it and she’ll make her terms sweet enough to shut down the offer process on Saturday.
Now all the other hungry buyers who were playing by the rules and are waiting to have their piece of cake (a chance to submit an offer on Tuesday as stated in MLS) are left hungry. They didn’t even have a chance to make an offer because they trusted the information that the Listing Agent put in MLS.
Did the listing agent lie to the entire market place? It leads folks to think that the agent and her company aren’t trustworthy. They set a rule and then broke it.
Shouldn’t an agent and seller who set the rules then follow the rules they set? Isn’t that treating the entire market fairly and respectfully?
I know. I know. The offer was too good to be true…More money than the Seller dreamed of and amazing terms. The offer specifically stated that if the Seller didn’t respond by Saturday the Buyer’s offer would expire.
After all, listing agents work in the Seller’s best interest, and since the Seller wanted that fabulous offer he decided to break the ground rules of the game he and his agent established.
Sure…you can justify the actions, but is there a better way? A way to play nice and take really good care of your client and treat all the buyers and their agents fairly?
Yes!
Here’s the win-win-win.
I’m not chastising anyone. But as agents, let’s think about best practices.
It’s all in the preparation. Seller’s agents in a hot Seller’s market have a duty to review this with their client BEFORE the listing is entered into MLS. Otherwise…it’s gonna get ugly, and ugly real fast.
Simple - Seller’s agents need to explain the market to the Seller. Anticipate the strong possibility that a buyer will want to have an offer reviewed before the stated deadline and ask the Seller if he would want to take that offer. If so, that Seller is not a good candidate for a strategy that gives time for the market to work. Agents need to guide sellers to either take offers as they come or to set a time to review offers. You can’t have it both ways. Or as they saying goes, “You can’t have your cake and eat it too.”
It’s helpful if an agent can explain why a buyer would want to demand an offer be responded to before the deadline previously determined by the Seller. It helps clarify the Seller’s thinking.
First, the buyer is afraid that someone will pay more later than she is offering.
Second, the buyer may not really want that house, but in a market where buyers are so desperate we are watching them buy houses they don’t really like just so they can secure a house, and that this buyer doesn’t see this house as special enough to wait for. How important is this house to a buyer who won’t wait until Tuesday? This bully buyer wants the ability to buy another if a “better one comes along.”
Third, and this is the part that should get the attention of the Seller, it’s a clue. A big, fat signal that this buyer is a rule breaker. Rules be damned. She wants it. Beware, it’s a sign of things to come. What other rules or courtesies will this buyer break during the transaction until closing? This is the equivalent of waving an “I am a pain in the ass flag.” Good agents know this. They can smell it.
Fourth, if it’s really the best offer the Seller is going to get, it will win on Tuesday.
And here’s the rub. Please don’t interpret this as being two-faced, but if you have an interested buyer in a property that has set these rules, I think a buyer’s agent needs to call the listing agent and ask if the seller would shut down the offer process if a great offer came in? Have the agent check with the Seller. Read the temperature. I’m not suggesting you make a bully offer, but a smart buyer’s agent needs to understand how the listing agent would handle it and if they would cave like Aunt Ethel.
Hey, we know a lot of agents are not well trained out there. And I’ve met a slew of excellent agents who didn’t know how to handle this issue and caved “in the interest of their Seller client.”
Let’s talk all about this. Set the rules. Play by the rules we set. Let everyone have a shot at the cake. That is the win for the Seller, Buyer and all agents. Yum!