A bird in the hand.....
Pretend that you have an OFFER; you do.
If you get a BETTER offer, you have options.
You will be in control.
Realtors know that when you have a Contingency, they can step right in and replace it: They will show your house, and they will try to sell your house.
Relax, you've got an offer.
if they have an approved non contingent buyer offer I could reconsider................Thanks again
There is one advantage to you - it doesn't tip the scales in your favor, but it does go on your side of the ledger - and that is: a contingent buyer doesn't have much leverage in negotiations. They really can't beat you up too badly on the price!
There is no right answer. You've been presented with a completely reasonable and common request, your own personal situation will dictate your response.
All the best,
One really needs to look at the market involved in the contingency sale. We just accepted an offer where the buyer's home was in the Bay Area in Northern California. It went into contract within days of listing and closed in under 30 days. In a hot market area, a contingency like that may not even be an issue. In our area, rural properties are routinely on the market for many months, so a contingent upon sale on a home in this area would be less desirable unless it was very attractively priced.
Contingencies of this nature are a sign of the times. From a positive perspective, you will have an agreement but one that is only good upon selling their property. In the mean time, put yourself in the shoes of JQ Public who is a buyer and sees and is attracted to your home. Is it reasonable to believe they will, after seeing that there is a contract "pending" on the property, exercise an interest. The answer is likely NOT.
So you would be simply putting all of your eggs in one basket and waiting for this buyer to sell their home. From my perspective, this arrangement is best for the buyer and does little to meet your needs.
The choice is yours ......but all of your concerns are valid. Proceed with caution!
I once was involved with a 5 way contingency. In other words there were 5 homes involved and #1 had to sell so #2 could sell and #3 had to close etc. I was involved with the #1 and #5 sellers and it was a nightmare to get it to all work smoothly (which it never did).
Some states use the term 1st Right Of Refusal and other use the term Contract with a Kick-out Clause. Both are the same, just different words. Like saying Car vs Auto or Pop vs Soda, it's the same just different way to say it. In NC we don't say 1st Right of Refusal.
First right of refusal is in the case of another buyer comes who along & doesn't have a contingency to sell their home, then you would give the current buyers the option of dropping that contingency or you are going with the new buyers who are ready to buy now.
Back when I was a real estate agent I noticed that these properties were put into a different section of the MLS called "First Right of Refusal", not even in the "Active" section, and so perhaps new real estate agents who aren't too MLS-savvy wouldn't think to check there for potential homes to show their clients... but if you are saying in your MLS it still shows as "Active" but a little notation next to it, and not put into an entirely different category, then all agents should still see it, but then you have to deal with the dense agents & buyers who'd just automatically write off a listing like that (but those probably wouldn't be the serious buyers anyway in my opinion).
I don't think the buyer could just back out of buying your home unless a contingency couldn't be met - such as selling their home first, can't get approved for a new loan (which perhaps if they can't sell their home they can't get approved for a new loan, hence an additional reason for that contingency), your home doesn't appraise for the purchase price, they find something in their home inspection they don't like, etc. A NJ real estate agent would know for sure.
If I was you, I'd also make them get their home inspection done, and proceed with their full loan approval/appraisal, etc. as if those items are going to be blow the deal anyway I wouldn't want to finally wait until their home sells and then do it. I wouldn't want to wait until they have an offer finally accepted on their home, or even their home sold, before starting all of that up, as it's possible they could have a quick sale and then my transaction would be the one everyone is waiting awhile on - I want to it go bang-bang, done. By requiring my buyers to do all of that, I'll really know if they are serious or if they are just tire kicking.
Then I still have the right to review other offers the entire time, and if one comes along without the contingency to sell their home first, even after my current buyers have gone through their entire process, I'd have some leverage.
I would ask your agent how other agents will perceive the status of your home on the MLS with the letter designation next to it. If your agent was showing you homes to buy, would that affect if they would show you a home or if you would want to make an offer on it?
my suggestion would be to tell (not ask) your listing agent that you will not accept their offer.....there are many different types of contingencies..this is one i would suggest that you pass on.