Peoria Realtor warns of risks in unbalanced real estate market
By Rebecca Durfey
It is currently a difficult residential real estate market in many ways.
There are so many tips for listing the house for a short period of time to encourage bidding wars, promises like “making sure” you can stay in your home for weeks or months after closing (a prospect of concern to a whole new level), various discounts for using a particular agent or lender to promise to buy your home if it doesn’t sell.
These agents and / or investors may or may not deliver on these promises, but an experienced agent who has gone through and understands these market cycles – and who can see through the various gadgets while providing sound, critical advice – might be more important than never before when you consider managing your most valuable asset.
As I have listened to our buyers, sellers, as well as appraisers, lenders and other agents, there is concern that this market is so far out of balance. If you work in this industry or buy or sell a home, this is a daily topic of conversation. The most common question: “When will this market balance out?”
It is exciting and profitable to be a seller right now. There is nothing wrong with it. The investment aspect of their house has paid off. We know the housing market goes up and down – and it’s currently favoring sellers. That’s great. What is concerning is that the market is so out of balance that we have buyers who feel they have little or no chance of getting their offers accepted, especially our buyers who are in the market under 350,000 and are limited by their liquidity or loans. programs. We also have sellers who have little incentive to negotiate and in some cases have unrealistic expectations of their buyers.
What probably concerns me the most is the sellers asking or buyers are willing to give up some very important contingencies – the protections put in place for both buyers and sellers. We find that offers far exceed market value and reviews are being canceled. We’re even seeing sellers demanding and / or buyers willing to forgo inspections – all in the hope that you get lucky and your offer is accepted. Our buyers shouldn’t feel like they’re rolling the dice in a casino hoping to win big. It turned into what looks like a lottery or a game of chance when writing offers on houses.
There are people and stories behind these offers. They have worked hard to be able to buy a house, and yet they have no control over the inability to do so – and it is very hard to see it happen.
The buyers are able, willing, and ready, but so are five, 10, 20 other buyers. There are heartbreaking situations there. There are desperate individuals and families who go out of their way to get a home and still haven’t chosen their offer. They may not be comfortable or able to forgo an appraisal or inspections or other contingencies, and therefore they are left out without a home because a sufficient number of buyers are “all in”. “And will do anything to” win “.
I hope we don’t forget the very human and emotional elements that come with buying and selling a home. I work with many buyers who have chosen their offer, and am grateful every time, but I work with a number of buyers who have drafted multiple offers and have been beaten in cash or given up on the offer. evaluation and several other waivers. They are protected, but that does not help matters.
I take great care to explain to my buyers and sellers what it means to forgo an appraisal or reduce inspection days (I have never waived an inspection period and in my experience this would be a very reckless thing for a buyer and a seller to do), but I leave it up to them to decide what they want to do. I have never seen a seller ask a buyer to waive any of these contingencies or contract inspections. I know this happens a lot. If a seller wanted these terms from their future buyer, I would immediately share the very real risks the seller takes in demanding these terms. It is not a wise requirement.
It’s such a lopsided market that many buyers have collected the keys to their new homes and found that sellers haven’t cleaned the homes or left debris in the homes. Fortunately, this doesn’t happen often, but it’s sad that it does happen at all. I’m seeing more and more sellers wanting to live in the homes – for free – for weeks, if not months, after they close. I can understand signing a lease and renting a house if it works for the parties, but what a serious risk for buyers and sellers when there is no signed lease and no guarantee ‘is in place for both parties. Please make sure you are protected when renting or leasing.
Hope we agents consider how very important, so important it is to protect our buyers and sellers. Terms that sellers demand, and sometimes demand, on terms that our buyers offer – sometimes bringing everything to the table in the hope of being chosen – both parties need our strong, experienced, impartial, unemotional, more honest advice and advice than ever before.
The market will adjust over time, but by then I hope we can be sensitive to each other.
Sellers try to find the right buyer for the home and make sure it closes on the day it closes and that buyers try to find a home that meets their needs. Hope we all do our best and are respectful along the way.
Editor’s Note: Rebecca Durfey is a Peoria-based real estate agent with Keller Williams Realty Professional Partners.