The other day I was discussing the Real Estate market in the Raleigh NC area with a friend and the topic of being a Listing Agent dominated the conversation. Without going in great detail I was explaining how listings are very circumstantial...and by that I mean there are so many factors influencing the marketability of the property that it is hard to please or appease every seller. Most sellers LOVE their home and can't see why anyone in their right mind would not want to pull the trigger.....but location, colors of walls, smell, slope of the lot, school zone, proximity to work.....the list goes on; all of these effect the marketability of the house. With that I said "more times than not, it takes the right buyer at the right time to make it work". My friends comment to me was "I guess it's kind of like the college and pro football coaches....you win or you are gone, even though there are circumstances out of your control (budget, size of school, conference) you are suppose to win and if you don't you are OUT".
I thought about it for a while and even though it was kind of off the wall, it was true. No matter what you do to market a home and how good you are with clients and other Realtors that most of the time will bring that buyer, there are things you can't control and it's just part of the game and an understood rule that your time is coming if you no one buys. I will say that price is by far the number one factor that can get anything sold...with location coming in right behind, but as a listing agent you must be prepared to face ALL challenges and present them in the best light.
I thought about it for a while and even though it was kind of off the wall, it was true. No matter what you do to market a home and how good you are with clients and other Realtors that most of the time will bring that buyer, there are things you can't control and it's just part of the game and an understood rule that your time is coming if you no one buys. I will say that price is by far the number one factor that can get anything sold...with location coming in right behind, but as a listing agent you must be prepared to face ALL challenges and present them in the best light.
Due Diligence, The New Word In Real Estate
Posted 07-20-2011 at 12:09 PM by Stu Barnes
As of January 1, 2011 there was a new Offer To Purchase Contract being used in North Carolina. For the most part it has been greeted with open arms because of it’s simplistic nature….either buy or don’t. The previous contract left a lot of “grey areas” as to what would be a legitimate repair, or when the appraisal had to be done, or when the lender had to commit….many loopholes and no concise answer to the many “contingencies” that may arise. The new contract is blunt if you will….a due diligence period for you to make up your mind.
Basically if you are writing an offer on a house, typically you would put down earnest money, which is negotiable to the amount…and now you may be asked to put down a due diligence fee in addition to the earnest money. The due diligence fee is non-refundable unless you close on the property..there may be instances contradicting this, but those situations would require an attorney. The earnest money is refunded to you when you close on the property as well. There are 2 important dates in the new contract…the due diligence date and the settlement date. So to make and example of an offer very simple, there are 5 major things to look for whether you are the buyer or the seller….the due diligence fee, the earnest money, the amount of offer itself, the due diligence date and the settlement date. There are MANY other factors to consider when an offer is made, but that is why you have a REALTOR to guide you through.
So given the information above, let’s say there is an accepted offer on a home for $X. The earnest money is $X and the due diligence fee is for $X. The offer is made on June 1 and the settlement date is June 30. For arguments sake let’s say the due diligence date is June 20th. The buyer of the home has until the 20th at 5pm “time being of the essence” to have all inspections, loan approvals, appraisal, termite, radon, structural engineer inspection, survey…you name it….to be completed. If the buyer is not happy with any of these they can walk, but they would lose their due diligence fee. They would be returned their earnest money though, given that their termination is in writing before June 20th at 5pm. If the buyer decides to stay with the purchase, then both earnest money and due diligence fee will be credited back at settlement. If the buyer decides to walk after the due diligence date, they would lose the due diligence fee AND the earnest money.
Now there and MANY situations that may arise and all may be negotiated between buyer and seller. But, let’s say the inspections are complete and the buyer asks the seller to fix something…say the HVAC needs repair. The seller says no…take it or leave it….it is then up to the buyer to consider the cost to fix, what they are paying for the house, the money they have invested already at this point, the current market conditions, the location, the schools, the rate on their loan, will they find another house they like…..etc., and make a decision if it is worth it to stay with the purchase. Common sense says the seller wants to sell and the buyer wants to buy so these should be easily negotiated, but there are times when a party may not agree to another party’s request and that’s when you have to weigh your options. For more information on this topic or any other real estate question or concern, please visit our website…..hope this helps.
Basically if you are writing an offer on a house, typically you would put down earnest money, which is negotiable to the amount…and now you may be asked to put down a due diligence fee in addition to the earnest money. The due diligence fee is non-refundable unless you close on the property..there may be instances contradicting this, but those situations would require an attorney. The earnest money is refunded to you when you close on the property as well. There are 2 important dates in the new contract…the due diligence date and the settlement date. So to make and example of an offer very simple, there are 5 major things to look for whether you are the buyer or the seller….the due diligence fee, the earnest money, the amount of offer itself, the due diligence date and the settlement date. There are MANY other factors to consider when an offer is made, but that is why you have a REALTOR to guide you through.
So given the information above, let’s say there is an accepted offer on a home for $X. The earnest money is $X and the due diligence fee is for $X. The offer is made on June 1 and the settlement date is June 30. For arguments sake let’s say the due diligence date is June 20th. The buyer of the home has until the 20th at 5pm “time being of the essence” to have all inspections, loan approvals, appraisal, termite, radon, structural engineer inspection, survey…you name it….to be completed. If the buyer is not happy with any of these they can walk, but they would lose their due diligence fee. They would be returned their earnest money though, given that their termination is in writing before June 20th at 5pm. If the buyer decides to stay with the purchase, then both earnest money and due diligence fee will be credited back at settlement. If the buyer decides to walk after the due diligence date, they would lose the due diligence fee AND the earnest money.
Now there and MANY situations that may arise and all may be negotiated between buyer and seller. But, let’s say the inspections are complete and the buyer asks the seller to fix something…say the HVAC needs repair. The seller says no…take it or leave it….it is then up to the buyer to consider the cost to fix, what they are paying for the house, the money they have invested already at this point, the current market conditions, the location, the schools, the rate on their loan, will they find another house they like…..etc., and make a decision if it is worth it to stay with the purchase. Common sense says the seller wants to sell and the buyer wants to buy so these should be easily negotiated, but there are times when a party may not agree to another party’s request and that’s when you have to weigh your options. For more information on this topic or any other real estate question or concern, please visit our website…..hope this helps.
Total Comments 0
