The family’s decision to sell its house is one that is seldom taken lightly and comes laden with emotion and passion.
If only there were a way to make it more uncomfortable …
Even when houses receive multiple offers, there are many house hunters who visit the home only to reject it. That rejection stings, as do many of the multiple proposals that offer much less than list price.
It is entertaining to read through some of the propaganda from buyers who are offering considerably less than the list price submit with their offers. It is not unusual to find offers accompanied with photographs of the buyers’ beautiful, smiling families with brilliantly penned, heart-wrenching epistles suggesting why the sellers should sell for less.
When the house is under contract, the champagne is chilled. That is, until they read the contract, or allow someone else to read the contract.
After a thorough assessment of the 10-page document, many sellers come to the same conclusion: The home is not under contract at all, with many feeling that they have been duped into giving the buyers a “free look” at their house or an option to buy the home with no compensation.
The reason for this is the real estate contracts used in the residential world, in fact, favor the buyers.
In most contracts, the buyer will have an inspection contingency with rigidly set deadlines, yet how the matter is handled if deadlines are missed is chaotic.
While the contract can be terminated if the parties do not agree on all repairs within a specified time period, there are times when neither party actually wants to terminate, yet resolution is not imminent.
For example, often the inspection period is 10 days, and the buyer normally will comply and have an inspection within that time. Then follows an agreed-upon resolution period of, for this discussion, three days.
On the third day of resolution, the buyer says he wants a roofer and a plumber to examine issues the general inspector cited. The seller would be able to terminate, but there is no back-up contract. It could take days, even weeks, to procure another buyer, so she is held hostage by these demands.
So she relents.
In the meantime, there has been no word from the appraiser, even though the contract states the buyer should have applied for his loan by that point and paid any fees required of the lender, with one of those fees earmarked for the appraiser.
A call to the lender reveals the lender is awaiting the outcome of the inspection before ordering the appraisal. The seller reluctantly grants the additional time for inspection, which means the inspection/resolution period is now 23 days – the original 10 days plus three days for resolution and now this additional seven plus three more for resolution.
The inspection issues are normally resolved. If not, the seller would have to put them in the ensuing property condition disclosure.
By then, the appraisal takes another week or maybe even two. With the closing some seven to 10 days away, the sellers are not certain that the house will appraise or that the buyer can get a loan, even if the property appraises for contract price or better.
Oddly enough, most close, but the transactions are nail-biters for sellers.
Perhaps the champagne should chill until closing. And then there is the wire transfer thing. More on that one later.
Sale of the Week
Cranes are up all over Nashville, but the prices are not, in many cases.
For example, the house located at 614 B 11th Street in East Nashville was listed for $439,900, reduced to $399,900 and finally sold for $393,500.
Featuring the same amenities as the houses that sold months before the drywall was affixed to studs, this house did not have a buyer awaiting the final inspection.
Speaking of Metro and final inspections, any inspections for that matter, they are way behind.
The department is understaffed due to illness and attrition, and the codes inspector position requires people with a high level of knowledge and expertise in areas of electrical, plumbing, mechanical and overall construction.
So, many developments are months behind. Each phase requires “rough-in” inspections before the drywall can be installed. Then each phase requires final inspections before Metro will allow the home to be inhabited.
As builders wait days for inspections, the interest clock ticks and, at times, the buyers have been forced to vacate houses that they have sold.
When Steve Reigle listed the property, he felt that 2,242 square feet of shiny stainless steel, glistening hardwood floors, tile bathrooms, a tankless water heater and a custom shower would bring a mere $196 per square foot. By the time the house sold, the price per square foot had dropped to $175 per square foot.
With three bedrooms, two full baths, and one half bath, it fits the mold of the other Horizontal Property Regime (HPR) homes that have gone before it, but this HPR did not meet the same fate as its ancestors from the year 2015.
Richard Courtney is a real estate broker with Christianson, Patterson, Courtney, and Associates and can be reached at [email protected].