By Mike Bodeen · 11 December 2017
Two months ago, we listed a home in North Scottsdale. A beautiful home. Though it was ten years old, it had been impeccably cared for. The comparable sales in the neighborhood showed the value to be in the $625,000.00 range. We listed it for $639,500. This was not your typical listing, however, it was a short sale.
We haven’t heard much about short sales lately. The market has been steadily rising since it bottomed out in 2011. Some communities, including this one, however, were decimated. This was a new home subdivision 10 years ago. Virtually all the homes that sold in that neighborhood since then were either by foreclosure or short sale.
Short sales are usually an immense amount of work for Realtors, far beyond that of a normal sale, and yet, the commissions usually are about the same. In fact, many Realtors will actually pass these off to other agents because they would rather not deal with them. We have a lot of experience with short sales however, and as usual, we dove right in!
In this case, right after the home was listed, Jonathan showed the home to a buyer who fell head over heels in love with it. The buyer however, decided to use a different agent rather than Jon to write up the contract. Yes, there are buyers who will do that! We’ll call them “Buyer A.” We immediately received three offers one of which was “Buyer A.” We sent out a “multiple counter offer” form requesting each buyer to give their highest and best offer. One cash buyer would pay $630,000, and two others would offer full price. “Buyer A” went up to $675,000 and they also had a very strong down payment, like $400k. “Buyer A” was the winning bid.
Since the seller was in the beginning process of getting all the necessary paperwork together for the bank’s approval of the short sale, the initial qualifying process took 3-4 weeks. Finally, there was one form needing to be signed by the buyer which was delivered to them the Friday after Thanksgiving. By Tuesday of the next week, we had still not received that form, so we called “Buyer A’s” agent who got ahold of their buyer who said to him, “Oh, we bought another home and closed the day before Thanksgiving!” Yes, there are buyers who will do that!
You can imagine how we all felt about that. I’ll tell you this much — it’s not fit to print. For us, it was a bummer. For the buyer’s agent, it was a bummer on steroids! We just put the home on the market and quickly received a full price cash offer that we’re again in negotiations with the lender. There will most likely be a payday for us, though no guarantee, but not for him.
When folks believe that we Realtors get paid too much for what we do, we point to one word as the reason why: RISK! As long as we’re being hired by clients who agree that we only get paid at the close of escrow, and will get zero, zilch, zippo, nothing or nada, if it doesn’t close, then fees will remain where they are.
– Mike