Home Selling in 07066>Question Details

Joe Flumano, Both Buyer and Seller in 07002

Sellers Contingency

Asked by Joe Flumano, 07002 Fri Mar 19, 2010

Question for you…my wife and I are looking to buy a bigger house in our town. However, the few that we have liked so far did not even look at our offer because we still have a home to sell and have not yet placed it on the market.

So, our realtor is recommending that we list our home for sale before continuing our search for a new one. The realtor also says that we can list our home for sale with a contingency that states that we first have to find a house to buy before we will sell you our home.

Is this realtor trickery? Are my wife and I going to have to rent if we accept a buyer's offer and don’t find a suitable new house in our town within a certain time frame? Is there such a thing as this type of contingency? Also, when I list, should I make it known upfront that there is a full contingency attached to the sale of my home?

Anything you may have heard or know of would be highly appreciated!

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Answers

13
I have, in the past, used that tactic by putting in the listing "contingent on seller putting the house of their choice under contract within 5 days" (or something to that effect).

Yes, this will put off some buyers, but others will be willing to deal with it, if they like your home. Of course, for this to work, you have to have your eye on a property or two currently available in the market.

It's not "Realtor trickery"... it's a creative way to get you into the home of your dreams. Do you really mistrust your Realtor that much that you would think he would "trick" you into losing your home? If the answer is yes, then you need to change Realtors.
2 votes Thank Flag Link Fri Mar 26, 2010
Alan May, Real Estate Pro in Evanston, IL
MVP'08
Contact
Hi Joe -

Putting your home on the market with a sellers contingency is not a big problem. There is no "trickery" I do not understand how you come up with that. It makes sense, put your home ion the market and see how it goes, you can look also.. just fdo not get too attached to anything until you get your home sold!

Sellers contingencdies happen all the time.. I have bth buyers that say.. we can find a home and wait for it if necessary and I have sellers that have sellers contingencies also... It is no "big deal" overall.

Agents that say they will not show your home because of the contingency are full of baloney, clients usually dictate the homes to see.. and if yours is out there.. they wll see it., like anything else, there are terms.. yours happens to be contingent upon your find ing suitable housing.No big deal.. list ot before you miss the first time homebuyer tax credit that will apply to buyers looking at your home. .
2 votes Thank Flag Link Fri Mar 26, 2010
This is not "trickey" ... this is being honest and forthright about your situation. Your Realtor simply states on the MLS that the closing on sale of your home and on the purchase of your next home have to dovetail. If a buyer likes your home, and they're not being forced to buy and move quickly, this is not a problem. Of course, to keep it fair, you need to be out there seriously searching for your next home.
2 votes Thank Flag Link Fri Mar 19, 2010
Both realtors have gave you really great straight forward, advise. It can be done, and if your serious about buying a new home listing your current one is the first set, unless you can afford and or qualify to carry 2 motgages.
2 votes Thank Flag Link Fri Mar 19, 2010
Hi Joe!

Nope...this isn't trickery. This is one way to make sure that the transactions all line up.

Most sellers don't want to tie themselves to a deal if it's dependant on a property sale that isn't on the market. There are just too many variables in play. You CAN go on the market with the stipulation that you first need to find a new place to purchase. If that doesn't happen, then your house isn't for sale. I've done this a few times through the years. When an offer comes in on your place, they usually build in a clause giving you a limited amount of time to purchase, or they can get out without penalty.

The upside is that you stay in control, and don't end up owning more houses than you can afford. (Actually, the mortgage company would prevent that by not issuing a mortgage commitment to buy if your current house wasn't sold). The downside is that some potential buyers for your house might not be interested in waiting for you to find something else. This could limit your buyer pool.

Hope this helps. Good Luck!
2 votes Thank Flag Link Fri Mar 19, 2010
Your real estate agent is right. Wouldn't you hate to find the home of your dreams and not sell your home. Of course there is this kind of contingency. It might limit your buyers, but if someone loves your home they will make it happen. I have had several clients that have done this so they know what price they will receive for their house.
1 vote Thank Flag Link Fri Mar 19, 2010
It's actually very common in this area to base the sale of one property contingent on the sale of another. Your realtor may be able to finagle dates and have the 2 properties close on the same day, but it's possible that either you or your buyer will need a short term rental to bridge the time between closes. Incidentally, it's often easier, and faster, to find a house you like than to find a buyer for your home, so finding your buyer first is probably your best bet. Good luck to you!
0 votes Thank Flag Link Wed Jul 11, 2012
I see your house. I want to buy it. You come back saying you have to wait until the seller finds a house they like and is buying it. I look really confused, wonder why you really do not want to sell and walk away looking for another option.
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Do you really feel that you would "walk away", if I told you that my clients have two homes currently on the market that they want to buy... we need a maximum of 5 days to put one of those under contract (we might be able to accomplish it sooner), before we can consider your contract "ratified"... but we've agreed on a price?
0 votes Thank Flag Link Sat Mar 27, 2010
Alan May, Real Estate Pro in Evanston, IL
MVP'08
Contact
I see your house. I want to buy it. You come back saying you have to wait until the seller finds a house they like and is buying it.

I look really confused, wonder why you really do not want to sell and walk away looking for another option.

You can do anything you want. Someone may not mind. When I want to buy I do not want anything in the way. I want my buyers bribe too you know. SInce this might not happen and time is tight to get the free $8k I do not have time to play with you.

Put it up for sale. Pack your stuff away. Be prepared to rent for awhile until you can buy what you want. That way you tell me ok, will sell, can move out tomorrow. I am happy. I like your house. I will buy, you can take that money and buy your own.

Why sweat renting a short time when it could solve a potential problem?
0 votes Thank Flag Link Fri Mar 26, 2010
Hi Joe
I know as a listing agent that a lot of buyers agents show their clients homes for sale before they put their house on the market to motivate them to get their home on the market. The safest thing for you to do is to list your home for sale at an attractive saleable price without contingencies to find a home. It is okay to still look just don't commit to any one home until you get a sold offer. Then you can come in with an offer on a house that you like & appear as a stronger buyer & negotiate your closing date with both. You should will still have a contingency on the contract of the home you are buying protecting you that states the closing is contingent on the closing of your present home. With the start of the Spring market more homes will be listed & there will be plenty of homes out there for you to choose from when you are ready
0 votes Thank Flag Link Fri Mar 19, 2010
Joe,

You either are on the market to sell your home or you are not. Putting your home on the market with a contingency like that will scare away most buyers and agents. If I was working with a buyer in your area, your home would go to the bottom of the list and would probably not be shown. Less showings ultimately equals a lower price.

If you are picky on the buy side, just reconcile yourself to the fact that you might have to rent while waiting for a suitable home. Then sell your home with no reservations and no delays. You can put all your stuff in storage and live light in temporary housing until the right house comes along.

Listing your house "subject to the buyer finding a suitable home" is like not being on the market at all, and buyers and buyers agents will treat your home that way if you list it like that.

Good luck!

-Marc

Marc Paolella
Relocation Director/Appraiser
Century 21 Joe Tekula Realtors
Phone (direct): (973) 584-4235
Web: http://www.marcpaolella.com
0 votes Thank Flag Link Fri Mar 19, 2010
You can do that, however, just as no one is wasting their time accepting an offer from you, buyers may not waste their time placing an offer on your home due to a contingency like that. In this market, these contingencys do not work very well, if at all.
Web Reference: http://www.sjrates.com
0 votes Thank Flag Link Fri Mar 19, 2010
If you need the proceeds from your current home to move to a new one it is a good idea. If you get an offer on your home and they have to sell their home and have not listed it yet, would you take their offer seriously. Probably not. Many seller have a hard time wrapping their minds around the idea of how this can possibly work. Having an experienced agent to guide you thru the process is key. Coordinating both moves can be tricky but can be done. Since you have been looking already you have seen what is out there and have probably eliminated many homes already. You need to be realistic in your expectation of what you are looking for. Know the prices and be realistic. In a buyers market which is what we are in now , if you get a reasonable offer with no contingencies I would be very hesitant to put any strongly worded contingencies in the contract. I would make an effort the put the closing date out 60-120 days if possible and say if you can coordinate your new move you could move sooner. Best of luck to you in your home sale and home search.

Denise Gueterman Weichert Realtors 142 Main Street Chester, NJ 07930
908-303-2472 Cell 908-879-7010 Office 908-879-7010 denisegueterman@hotmail.com
0 votes Thank Flag Link Fri Mar 19, 2010
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