SOLD! (almost)

| Monday, July 16th, 2012 | No Comments »

Lately I haven’t had as many people ask me how the market is because they can see for themselves. If I had a dime for every person that said to me lately they saw a for sale sign go up one day and a sold sign a few days later, I would have at least a buck fifty! It’s true, signs are going up, homes are getting offers and signs are coming right back down. But here is a little something that I think confuses some people. When you see the sold sign hanging across the for sale sign, that doesn’t actually mean the house has sold. Here’s the scoop:

The timeline of events goes like this (in a perfect world):
The home goes on the market and the sign goes up. The home gets an offer (typically in the first week in today’s crazy market). The buyer has a few days to do an inspection. During this time if you look up the home on any real estate site it will probably say “pending” or “pending inspection.” Once the inspection is done and settled, the sold sign usually goes up but there’s actually about 3 more weeks until the home sells. Unless it’s a cash deal then it’s a matter of days. During these three weeks the buyer is obtaining their loan and getting all their financing in order. At the end of the three weeks (usually a month from the time of the offer) the house is officially closed and sold. The status moves from “pending” to “sold” and the new owners move in!

And here is the most common question I get asked during this period: How much was the offer for?
The answer: Nobody knows except the seller, buyer and their agents. That information is not published until the house actually closes and here’s why. If the buyer were to back out for any reason or not get their financing secured, the house would go back on the market. A new buyer can use the previous offer price to their advantage when making a new offer.
Another reason the offer price is not disclosed is in case of multiple offers. If there is already an offer(s) and you come along and want to write a competing offer, there is no way you are going to find out from the agent or seller what the current offer is no matter how nicely you ask. They want you and the other offer(s) to compete against each other, thus hopefully driving the price up higher and higher. In my next post I’ll talk about escalation clauses which is something we are seeing more and more. Escalation clauses are good for the seller, not so good for the buyer.

If you are not thoroughly confused after reading this and/or found this explanation helpful, post a comment! I love those!

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