Broker tactics
Lets take a “hypothetical situation†You look at a property. You pass. After a few months, you contact the broker. He says there’s an accepted offer and contract out pending signature. The broker then comes back and says the seller’s have agreed to tell us the accepted offer, if we pay $xxx (less than 1%)…
Lets take a “hypothetical situationâ€
You look at a property.
You pass.
After a few months, you contact the broker.
He says there’s an accepted offer and contract out pending signature.
The broker then comes back and says the seller’s have agreed to tell us the accepted offer, if we pay $xxx (less than 1%) over the accepted offer they will consider.
Its April 2009 not July 2007.
Thoughts?
The seller/broker have clearly indicated that they have no ethical problem with backing out of a good faith agreement. It’s sad and telling that these folks would abandon their morals for a lousy 1%.
The possibility also exists that the first bidder may counter your offer with a higher number – after all, it’s only 1% more. Then what would you do?
Your initial decision to pass would indicate that you felt the property was un-extraordinary, has something been revealed that has changed your mind?
As I read it.. the seller hired a broker to get the HIGHEST offer.. legally of course. It is perfectly legal to sell to the highest or best bidder. That is EXACTLY what the seller is paying for.
Also, the buyer called the broker a few months after they first saw the property. They are indicating SOME level of interest… the broker told his client, and the seller is fishing for a higher offer. HELLO??? what is wrong here>>>????? NOTHING.
Poster, either make the higher offer, or stop wasting everyone’s time. Jeez… if you like the property, GO FOR IT… BUYERS change their minds all the time, the seller has the same rights. There could be a hundred reasons why the deal isnt executed yet,,, could be the seller OR the buyer delaying… but why is the SELLER and/or BROKER being villified???
Holdup. I just re-read your post.
“The broker then comes back and says the seller’s have agreed to tell us the accepted offer, if we pay $xxx (less than 1%) over the accepted offer they will consider.”
Bull hickey. The contract is out and they’re trying to get higher bids? Especially in NYC where it is pretty standard to sink a few grand into a property before you sign (engineer and lawyer) that is some bad faith.
We had a situation where the broker asked the seller’s lawyer to prepare a new contract while we were negotiating our contract (details about the fire escape and an existing tenant that we’d verbally agreed on but that weren’t in the first version of the contract). The seller was pretty upset because 1) she hadn’t agreed to any new contract and 2) she thought that was pretty unethical. They had actually cut off communication with the broker because they felt she was out of bounds.
It is not inconcievable that the broker, not the seller, is the shady party here.
I would definitely hold my ground. There’ve been some discussions here about written offers, which the broker is legally obligated (as I understand it; I am not a lawyer) to relay. So consider saying “no, our offer stands, and we’d like to put it in writing.”
Just one very simple thought: Place your bid (totally independent of whatever bullshit they say is on the table) and treat the broker like an ugly chick (assuming you’re a dude). Either “she’ll” call you or you just completely forget about the whole opportunity.
That’s power (to the one most willing to walk). That’s leverage. If and only if it is meant to be.
Good luck (to the seller – you don’t need it, there’s too much growing inventory).
***Bid half off peak comps***
just for clarification, when brokers have told me about “offers at $X”, I generally laugh and tell them they need to sign quickly.
It depends how badly you want the house and whether or not the higher price makes sense.
I’m leaning toward the ‘bucket’ camp.
First, you don’t know if the contract hold-up is on the sellers’ end or the buyers’. The buyers could have signed off and are waiting in good faithe for the sellers to sign, and the sellers’ greed was piqued by your call. Add into that the fact that the broker says the sellers will ‘consider’ (not agree to) a higher offer and it seems like someone is trying to ignite a VERY late-in-the-process bidding war.
A more ethical way for the broker to handle it would have been to tell you: contract out, should be signed by X date, if sign date passes, seller will entertain other offers.
I’m also a little uncomfortable with the broker’s soliciting your offer. It’s one thing if you call up and say, hey, here’s our offer if the property is still available. It’s another for the broker/seller to give you a HIGHER number for you to get admitted into the process.
I’m of the mind that if the seller/broker is playing this game with you, they’ll keep playing it when you’re the one on the other end of the contract.
I guess you have to gauge how much you want the property and your tolerance for dealing with characters like these. If you do go ahead, go in with your eyes open and put in the contract a firm and fast “contract sign” date for both parties and be prepared to walk if it’s not met.
Good luck.
I’m with Mopar, at least in that there could be nothing at all wrong here.
Not inconceivably, the folks sitting on the contract are dawdling around. They haven’t signed, they’re trying to add things they knew all about back into the negotiations (“our engineer says that the flooring has to be replaced” when actually it was obvious to anyone with eyeballs that the floors were shot.) and the sellers are saying “Look, if you don’t want to sign, fine. We’ll find another buyer.” I don’t think that is really so awful. Or, they just can’t close. Things change all the time. So the buyer said “sorry, we can’t sign a contract afterall.”
Do you even know that your offer is higher? I wouldn’t sweat the last contract but if you don’t want to go up, don’t. That is negotiation. If you’d rather not buy the house than pay 1% more, okay. If you’re willing to call their bluff and walk away, okay. If you think it is worth 1% to know this will be your next home, well then …
It is an imperfect science. They want the most they can get but they also want to sell. You want to play as little as you can, but you also want to buy. So you negotiate.
Actually, it sounds reasonable to me. The contract has not yet been signed by the buyer. The seller is still free to consider other offers.
One percent higher is not much. (Then again, they could be lying). It’s possible they have a decent offer but the buyer doesn’t have a big down payment or good credit, and they might think your offer would be more solid. This happens with coop sales all the time.
Dunno.
I guess the question is whether the amount is what you want to pay. Definitely, it would be silly to pay higher than market rate because the agent is pressuring you with a story.