With the San Carlos housing market leveling out, sellers will need to be on top of their game when dealing with prospective buyers. The “take it or leave it” negotiating tactic of sellers over the past 12 years in San Carlos has come to an end. While our market is still healthy, I believe it is safe to assume that buyers can afford to be more aggressive in their negotiating, especially above the 1.4M mark. Further, the selection of your real estate agent will perhaps be more important now than at anytime in the past 10 years. Why? I believe you are going to see a lot of homes going into contract, only to have the deal go sideways….quickly. Bottom line: Expect some buyers to try and negotiate heavily on the back end of contracts. In other words, expect some buyers to ask for price reductions, credits, repairs, extensions, specialized financing, etc., after the home is in contract.
So what can your agent do to help protect against these types of tactics?
(1) Write a Solid Contract. Do not allow for ambiguities in the contract, counter offers, addendums, etc. If you are not comfortable with the language that is being proposed, insist that your agent’s broker of record be involved in the drafting. Do not be afraid to have an attorney look at the language. In my opinion, the standard PRDS contract that is used by realtors in San Carlos has loopholes that could lead to some exposure under certain circumstances.
(2) Double-up on Financing. Insist that the buyers be pre-approved by two different banks. Banks seem to have requirements and guidelines that are changing daily. A potential buyer may be qualified one day, and not qualified on the next day. Insisting that the buyer double-up on on the financing end will lessen the risk of the deal failing due to financing issues. The only real hard cost that will be associated with doubling-up will be the cost of a second appraisal. In my opinion, this is a reasonable request to put upon the buyers given the current nature of the financing industry.
(3) Common Sense. This one should go without saying, however, selling a home can be stressful and common sense can suddenly leave some sellers under certain circumstances. Screen buyers carefully. If they are tough prior to writing an offer, you can probably guess how the remainder of the contract period will go. It can be very hard to take the emotion out of selling your home. Concentrating on the bigger picture could help with this issue.