- MG Home Chicago
When to walk away...from a deal.
Throughout my #realestate career I've been apart of a ton of successful, fruitful transactions for both #buyers and #sellers. Most deals get to the closing table and all parties walk away happy. Sometimes though, things are just not right! After a challenging week with a client I thought it was only fair to write down what I know to be true about #breakups - real estate ones that is. And since we're talking breakups, strap in. This post is a little long, but what breakup is ever quick and easy.
Sometimes we fall in love with a home, whether for the perceived financial upside or the actual space inside. Either way, we have an initial love affair, call it lust. Think about it, you've seen the property probably only once or twice, a handful of times at most. The minute we fall into "lust" with a property, we are pushed to make an offer to buy. Call it fast but that's real estate. You don't marry someone after 2 dates, but homes are different. We hope we can come to terms with the seller and buy the very home we are falling for. Say we do it. Say the seller agrees to a price and terms that work for us. Now what? It's ours? We're locked in? We've only been on two dates! #speeddating
I wrote a list of every failed deal I could think of that failed after we were under contract. Sure, most deals close. Most buyers do end up buying the property they've only been on a couple dates with. But some deals don't close, and for good reason. I took my list of failed contracts and categorized the reasons why each deal didn't end in a marriage. I came up with what I now consider "A Homebuyer's #Redflag Check Points".
Check point #1:Attorney Review Gone Wrong
This is a time for attorneys on both sides of the transaction to fight it out about the words in the contract as well as important things like inspection, taxes, and general quality control. They are protecting you. Assume the attorneys are your big brother. Overprotective and sometimes strongly opinionated but ultimately looking out for your best interest.
"so and so could .... vs so and so shall"
"The basement sink has a leak. Seller needs to give buyer z amount of money to fix."
I had a client looking at a fixer upper loft. The unit had a large ground level concrete patio off the back. The unit had a ton of potential and I think my client fell in love with the possibility of what the property could be more so than what it was. During our inspection we found out that the slope of the outdoor concrete pad was pushing all the rain water/snow towards the unit instead of away from the structure. A fixer upper we thought just needed interior work turned out to have an expensive issue we couldn't take on. Floods are not cheap! When the money no longer makes sense, we cancel.
Check point #2:
Final Walk Through Surprises
The day before closing or the morning before, you (as the buyer) get to see your love one last time. Make sure the property looks, feels, smells how you remember it. Make sure those butterflies are still there. You look to make sure everything is exactly as you remember it and the property hasn't fallen apart in the few weeks since the last time you saw it.
When I was selling new construction, we were selling units quicker than I could change my clothes. It was fast paced. We had a sales office set up in one of our completed unit. A fully furnished unit we used to work and to show what the building had to offer. This was my office for over a year. When it came time to sell that unit - it was easy. Furnished, organized and almost lived in, buyers felt at home. On “final walk through day” for our office all the furniture had been removed and the buyer was seeing the unit empty for the first time. The engineered wood floor had changed colors from the sun exposure over the year we occupied the space. Only problem - where we had rugs, no color change. The unit was not as pristine as we had thought. My boss, the developer, didn't want to make a decision the morning of closing on what to do, and the buyer didn't want a damaged unit. When it's not right and it can't be made right, we cancel.
Check point #3:
Your Gut is Screaming
This one is hard. There is no designated portion of a real estate transaction called "the gut check". No true stopping point to check in and ask yourself, "Am I still in lust? Am I falling in love?" The gut check has to be continuous and really the job of your realtor to remind you to check in with yourself before going further and further down the rabbit hole. Sometimes your personal life changes and making a huge purchase is no longer exciting. Sometimes the property changes and it no longer spikes the enthusiasm it did those first two showings/dates. This reason for canceling isn't measurable, its instinctual.
I had clients looking for a needle in a haystack. The neighborhood they wanted, the price they needed and the private rooftop deck they refused to negotiate on, was quite the challenge to find. It just didn't exist and somewhere they would need to cave. We found a property that almost fit the bill. One small problem, the rooftop was in theory private but had no divider between their private space and the neighbor’s. We went under contract assuming we could figure this out with the neighbor and put a permanent divider up. Two weeks of back and forth, the neighbor flat out refused to "build a wall". My buyers went from being in love to being in hate. This wasn't a point they could cave on. Their hearts were out, and so were we! When things get tough you stick it out. When your heart isn't in it and your gut starts screaming, we cancel.