Get top dollar for your home; Tips to know and Tricks to avoid!

Many homes In Santa Clarita, Valencia, Canyon Country, Saugus, Stevenson Ranch Newhall and Castaic have multiple offers. Yet there still are many homes which do not have any offers or have received only a few low priced offers. The increasing prices being offered by buyers who are competing with multiple offers on homes listed for sale is presenting new issues for sellers to be aware of if they want to win the game of getting “top dollar” for their home. You can read my other article about “selling your home in an increasing market,” to learn what you can do to improve the desirability and price of your home. Even with the low inventory of homes on the Los Angeles, Santa Clarita and San Fernando Valley market, some homes are selling with many multiple offers while others are still sitting and waiting for an offer to be made.

Desperate buyers and unethical ways of some agents

Many Buyers and their buyer’s agents who represent them are getting desperate to get their offer accepted by the seller. I have spoken with some buyers agents most recently on one of my listings where I had a wonderful bidding war going with over 30 buyers presenting my seller with offers. I was told by some very weary and discouraged buyers’ agents that my sellers home was one of 50 homes that the buyer has already written an offer on that was again refused. Many of the buyers and their agents are exhausted to the point of resorting to some creative but possibly walking the thin line of unethical behaviors to get their offer accepted by a naïve seller and listing agent .

Buyers will sometimes offer the top dollar bid for your house which they plan on getting reduced later. One of the most common ways that buyers “trick” naïve sellers and their agents into accepting their offer on a home is to offer more money than they know the house will appraise for. In this situation the buyer appears to be very generous in offering you a specified high price for your home knowing that once the house is appraised they will ask for a price reduction bringing it down to the appraised value. All California Association of Realtors “CAR” Purchase offer forms contain a provision granting buyers the right to perform an appraisal on the home, whether it be a cash, large down, FHA, VA or conventional loan buyer. If your home does not appraise for the amount that was offered, the buyer has the legal right to cancel the sale and have their purchase money deposit returned to them in full. In other words, you just pulled your home off the market and wasted valuable time by accepting their offer, possibly turning down other offers and the buyer walks away unharmed ready to bid on the next house that comes along, and it cost them nothing!

Preventing the price of the home from being lowered

A savvy seller and listing agent should predict and prevent the price of the home from being lowered. There are several things that a savvy seller and their listing agent can do to prevent this situation of the home price being lowered after an offer is accepted and the price has been agreed to by both the seller and buyer. One way to prevent this situation is to be aware of the type of loan and down payment that the buyer is offering, the lower the down payment the more important is the appraisal. Also, although it is not “officially” printed in any lender’s manual, it is commonly understood that “border line” home price appraisals are viewed as higher risk to lenders who are granting a higher loan ratio to buyers with small down payments than those with larger down payments. However, a low appraisal even to a cash buyer or a buyer with a large down payment can be used to justify a request for a price reduction from the seller.

The home seller can request an “appraisal waiver” from the buyer prior to acceptance of their offer. It is possible for the home seller to request that the home buyer waive their right to an appraisal or waive their appraisal contingency as a condition of accepting their offer. However, the seller must be aware that this waiver request may cause issues with the buyer’s lender and affect their final loan approval. It s important that the appraisal waiver be done correctly so that it does not raise a “red flag” to the buyer’s lender.

The buyer may find “other reasons” to lower the price of the home after acceptance of their offer. There are other things that buyers can do in an attempt to lower the price of the home after the agreed upon price was accepted and the home was taken off the market to open escrow. Sometimes buyers will “stack” the request for repairs with many items and ask for a large “credit” rather than for repairs. Sometimes the request can be for thousands of dollars for not only items in true need of repair but in “safety issues” and code violations for things that were considered just find when the home was built but every few years safety codes do change.

The seller can respond to many “violation of code” requests for credit by citing “inherency” clause. The seller can rebut this situation by acknowledging the buyer’s claim that the codes may have changed but those issues are “inherent to the age of the home.” As a listing agent I have saved my sellers from paying out thousands of dollars in repairs by quoting that issue to the buyer and buyers agent. The buyer does have the right to withdraw their offer if the seller does not agree to make a credit for the repairs.

Selling the house “as is” can often prevent large credit requests but that can be a double edge sword. A seller can sometimes though not always protect themselves by making the sale “as is” although that can be a “double edge sword that is not always in the best interest of the seller to do so. It is likely that some honest and decent buyers may falsely believe upon reading the words “as is” that the house must have many problems and violations associated with it and may never even come to see it.

A seller’s failure to disclose a tax or special assessment can prompt a price decrease request. I have seen buyers use unknown taxes, such as school taxes, meloroos taxes, and homeowner’s association assessments as an excuse for requesting a large tax deduction. Sometimes the owner of a home is paying a monthly fee because they had new roofs installed in their condominium complex. I have seen buyers request a sales price discount citing that they had not been told about that fee prior to making the offer. It was disclosed however once escrow was opened almost as soon as the offer was accepted by the buyer. These types of assessment disclosures or tax disclosures are part of the “inspection contingency”which is part of the legal right of the buyers to investigate. Once again the buyer can tie your home up off the market and then just “walk away” without it costing them a penny to cancel.

Work with an experienced and intelligent agent to predict and prevent costly issues. A home seller and the listing agent can protect the seller from these types of costly situations by investigating and understanding the details of the home which is being sold and predicting PRIOR TO LISTING the home the probability of these types of problems occurring. An experienced and wise real estate agent will work with the home seller to predict the issues that could occur and best determine how to prevent the these issues from becoming a costly problem for the seller.

If you are thinking of selling your home, please contact Lauren Nemeschansky, Santa Clarita real estate agent for a free market analysis of your home and consultation so you can get the maximum price with the minimum amount of aggravation and stress. My direct number to call or text is (661)310-8215.