Home Buying in Seattle>Question Details

Wanta Know, Home Buyer in Bellevue, WA

Are contingent offers being more seriously considered now?

Asked by Wanta Know, Bellevue, WA Fri Oct 1, 2010

What is the time frame typically? is it still 45 days?

Help the community by answering this question:

Answers

23
Hi Wanta Know,
I tell my sellers to consider all offers a compliment, and a contingent offer as a concession. When an agent calls to find out if we will consider a contingent offer, I always say it depends on the offer, the home the buyer has to sell, the track record of the agent in getting listings sold and the price they intend to market the home at.
With average market times being longer than a few years ago, the contingent buyer has to be aggressive in their pricing and marketing for me to advise my client to take it. The purchase price offer has to be attractive and worth waiting for.
Contingencies are working if everything is done right, but you have to build a compelling case.
2 votes Thank Flag Link Fri Oct 1, 2010
Mack provided really great data. That should answer part of your question. Being in my profession I've seen a lot of buyer's remorse from folks passing up on the inspection contingency. I was one of those people many years ago before I became an inspector. That's my only word of caution.
1 vote Thank Flag Link Tue Oct 5, 2010
In this market, I'd always recommend to my seller to consider a contingent offer. The kicker is I want to look at the home they need to sell, and make sure it's priced well. If it isn't, make their pricing a requirement of acceptance of the offer.
1 vote Thank Flag Link Sun Oct 3, 2010
No.

They've always been seriously considered, except maybe in the first few days the property is on the market. But a glimpse at the NWMLS shows only five Bellevue homes sold "contingent," so if two more go contingent this week it will be the fastest growing trend in real estate!

All the best,
1 vote Thank Flag Link Fri Oct 1, 2010
Dear Wanta Know,

The challenge with contingent offers in any market is that they essentially take the property off the market. Showings drop dramatically once a property shows contingent.

In fact, in a Buyer's Market, where the Buyer has the advantage and there is a wealth of inventory, the problem for the Contingent Seller is exacerbated. There are so many properties for a Buyer to choose from, that the Seller with a contingency for the Buyer to deal with, gets ignored.

In my experience contingent offers are 20 - 30 days, just enough time for the Contingent Buyer to get their propety sold if it is priced right. It is usually wise for the Seller's listing agent to shorten the bump period to two days to try to lessen the negative effect of the second buyer having to deal with a contingency.

I know it can feel scary, but if you have to sell a property to be able to buy, the best strategy is to get your property sold and then you are in a great negotiating position because you are a ready, willing, able buyer. Of course you will also need a pre-approval letter from your lender.

Warm Regards,
Karen
1 vote Thank Flag Link Fri Oct 1, 2010
It all depends on the offer, the price amount, and what sort of contingent they are bring to the table.
0 votes Thank Flag Link Wed Oct 13, 2010
Any offer these days is taken seriously.

The time frame depends on the contingency, the importance of the contingency and the overall impact it may have on the transaction, if an agreement is reached.
Web Reference: http://www.golftobeach.com
0 votes Thank Flag Link Wed Oct 6, 2010
It may be worth a shot. But always remember with a contingent offer, you will most likely have less negotiating power with the seller, especially on price. And some sellers may just reject your offer altogether, especially if they want a quick close.

However, if you and your agent plan ahead and structure your offer accordingly, you may be able to make your offer attractive enough and the seller may consider it. Best wishes to you.
0 votes Thank Flag Link Wed Oct 6, 2010
There was a sale earlier this year in Kirkland West of Market where the seller accepted a contingent offer and the house sold for considerably more than it would have without the contingency. So those agents saying no never on behalf of their seller client, may be leaving a large some of money "on the table".
0 votes Thank Flag Link Sun Oct 3, 2010
No, not in my area. I have yet to represent a Seller who would accept an offer contingent on the sale of a Buyer's home.
0 votes Thank Flag Link Sun Oct 3, 2010
Wanta Know,

Bridge loans add too much cost in this market...better to move to a rental if you want to sell before you buy...or price it well and stay with relatives for the first couple of weeks when showings are the heaviest.
0 votes Thank Flag Link Sat Oct 2, 2010
Contingent offers (contingent upon the sale of the buyers home) is one way to purchase your next home, the other option would be a Bridge Loan - which is one option to consider if the seller of house you would like to purchase won't take a contingent offer. Your Windermere agent will have more info on Bridge Loans! Good luck.
Web Reference: http://www.leahpham.com
0 votes Thank Flag Link Sat Oct 2, 2010
Yes they are, but typically these days the seller will want to know you are serious. This is done by having their agent run the comps on your home and only agreeing to the contengency if 1) you are priced right for the market and 2) if you have planned dropps.

I reciently put together an accepted contengency like this.

The (Buyer) with the contengent offer had their home listed at $549,500. Once I ran the comps I found them to be $20,000 over priced.

This is what we offered back.

My clients accept the contengency if they 1) Dropped their price to $530,000 for 3weeks, then they drop to $525,000 for 2 weeks, Then they drop to $515,000 for the remainder of the contengency.

So basically we accepted the contengent offer, but we controlled the contengency to get the sale.

They closed at $522,000 and purchased my client home in Bellevue which closed this past Thursday.
0 votes Thank Flag Link Sat Oct 2, 2010
I presume you're talking about contingent on the sale of your home. I would only advise my sellers to accept an offer contingent on the sale of the buyer's home if they were in escrow already. Best, Terry Bell, Realtor, Santa Rosa, CA
0 votes Thank Flag Link Fri Oct 1, 2010
Contingent offers are being considered and accepted, but every seller and situation is different. One of the biggest factors, as others mentioned below, is time on market. Even in this market, a seller will most likely not accept a contingent offer if it's only been on the market a week or two.

I have represented two buyers this year who have bumped the first position buyer who made the contingent offer. The other downside to a contingent offer is that you'll spend money on an inspection with no guarantee the home is yours. If you are actively looking to buy a new home, it's best to get yours on the market now. Even in the event you sell yours first before finding a new home, you can always rent for a while. That's a much better scenario than feeling the pressure of selling your house, especially if some other buyer wants the same house!

Best of Luck!!
0 votes Thank Flag Link Fri Oct 1, 2010
You cannot buy a short sale, or a bank owned property, so that pretty much eliminates almost half the properties on the market. You can try & buy one of the remaining ones, but you will not have much negotiating room on price in my opinion. So, bottom line is, you can, but I would not recommend it because you will probably not get a steller deal.
0 votes Thank Flag Link Fri Oct 1, 2010
Wanta Know,

Lots of good answers. If I were representing a seller, I would advise them to take the contingent offer in this market only and only if the property was in a desirable location and in good condition, was priced slightly below market and the sellers (potential buyers) were really motivated. Other than that as suggested by others seller is taking a big chance.

Good luck house hunting.
0 votes Thank Flag Link Fri Oct 1, 2010
A lot of people take their home off the market for the holidays. Someone like that would be a prime candidate for a contingent offer, since they are going to pull the house off market temporarily anyway. You may want to watch for homes that are cancelled and expired listings.
0 votes Thank Flag Link Fri Oct 1, 2010
It really depends property to property. I know the last couple I buyers I represented that had no contingencies got the houses vs the buyers we were competing with that had contingencies. Also the buyers I've represented this year that had no contingencies submitted offers on homes that were contingent and bumped the current buyer with a contingency out of the way as they couldn't move forward unless they sold their house.. It's worth a shot just not a guarantee it will go the way you want it to.
0 votes Thank Flag Link Fri Oct 1, 2010
Very common in New Construction of course, and I just finished one that was 30 days. The house sold in 4 days...so it didn't become an issue as to how long the builder may have waited.

As to resale, it really depends on the season and other factors. A contingent offer today would more likely be accepted than one on April 1, as the seller doesn't want to lose "prime time". Being "tied up" during October, November and or December is not as bad as being tied up in April, May and June.

How long the property is on market is a factor. Also you usually pay more for the house with a contingency than someone who doesn't have a contingency, so the seller usually makes more by accepting a contingency.

Any agent worth their weight in salt would first study the reasonableness of the buyer as to price and condition of the home they are selling. Often people who want to buy contingent on the sale of their house also overprice their home. So one of the key factors is how motivated is that buyer on the sale of their home, and are they really willing to sell it at today's home prices.

I doubt any seller would consider a contingent offer as soon as their home goes on market. There could be exceptions...but that is normally the case. On market 242 days...heck, why not take a contingent offer. :)
0 votes Thank Flag Link Fri Oct 1, 2010
Wanta Know,

Contingent offers are more common now than a few years ago so it is much more of a possibility getting one accepted. But each situation is different. Most sellers will want to take into consideration the location, style and price point of any contingent home. Some sellers are not in a position to wait. Some buyers do not want to be in a position to be "bumped" should a better offer to the seller come along. There are lots of variables for the parties and their respective agents to consider.
Web Reference: http://www.homehounds.com
0 votes Thank Flag Link Fri Oct 1, 2010
contingent offers are still a disappointment to sellers and listing agents alike. It is best to include as much information about the contingent sale as possible. The better the odds that the contingent home will sell, the more likely a contingent offer will be accepted.

It is still a long shot. Even non-contingent offers are struggling to close. So contingent offers offer even more hurdles.
0 votes Thank Flag Link Fri Oct 1, 2010
Every seller is diferent than the next with each having different motivation.
In a slower market contingent offers are definitely given more weight than in a sellers market.
It is important to remember that once a seller accepts a contingent offer, the traffic (agents previewing or showing) on their house usually decreases thereby creating apprehension on the part of sellers to accept contingent offers in the first place.
Dru
Lake & Company
206-799-8403
0 votes Thank Flag Link Fri Oct 1, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer