TORN FROM THE PAGES OF REAL WORLD REAL ESTATE:
(editor's note: this original story is from Dec 1, 2019. As of last week, seller still has not sold.)
Homeowner in 75230 near Royal and Hillcrest called me in early August to evaluate their property. It was a modest home on a nice lot, standard target for a builder or home remodeler. I gave them opinion of price, I shared my marketing program, and handed them a listing agreement. I was ready to get started.
Seller's told me they were going to try and sell it themselves and told me I could bring them a buyer and they would be happy to pay me a 3% buyers commission (gee thanks). I mentioned to them that according to NAR stats, less than 2% of "For Sale By Owner" listings actually transact, but they were confident moving forward with the information that I had given them.
I followed up with them in early October to see how things were going and the sellers excitedly told me they were under contract with a builder, scheduled to close on November 7th. They told me that they had gone to where they were locating and put a house under contract and everything was going great. I hung up the phone and kind of put this out of my mind.
We all know what happened on October 20th.
So - this week I have been doing my real estate follow ups and called this person to see how their sale went. It didn't.
She told me that a week before closing, the builder called them and said he felt that he could pick up properties much cheaper due to the tornado, he said he wanted to reduce the sale price of the house by $100,000 or he wasn't going to close.
"Didn't you refer to your sales contract? I hope you at least got to keep the earnest money."
Seller: "There was no earnest money. The builder only provided a letter of intent, there was no signed contract. We didn't know that he could change his mind at any time. When we went under contract on our new home, we had to pay earnest money and wondered why our buyer did not. Anyhow, we luckily were able to terminate our contract in the option period and get our money back".
Now these property owners are disenfranchised with the entire process and think that everyone is "out to get them". Their attempt to save a few dollars in commission cost them the sale of their house.
Moral to the story: There are some builders out there that love to engage sellers who are not using an agent. The builder knows they are WAY more familiar with the contract process than the seller is. Builder knows that they can enter into any "agreement", but seller has no ability to enforce terms.
Whatever you decide to do when selling your home, be sure to engage the services of a real estate expert that has your best interest at heart. It could mean the difference between selling...and not selling.