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Old 08-22-2013, 09:42 PM
 
2,309 posts, read 3,275,472 times
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When a house goes under contract, does this usually turn off any other potential buyers or will they still go view the home? I would think if a house is really desirable, then maybe.

What if they did go view and liked the house, would they just keep an eye out on it to see if the contract falls through and then make an offer if they were still interested?

How does that usually work? Personally, I don't think I'd be as apt to go view a home if it were under contract thinking I might love it and get my hopes up and then it's not available.

As a realtor, how do your buyers feel about looking at these homes?

Thanks.

Last edited by diddlydudette; 08-22-2013 at 09:54 PM..
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Old 08-22-2013, 10:05 PM
 
Location: NJ
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I think most people would think this was a waste of time.
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Old 08-22-2013, 10:19 PM
 
Location: Houston, TX
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Not a realtor, but having just gone through the buying experience, I would definitely go look at the house especially if it was still in one of the earlier contract stages. Having said that, my realtor told us that agents generally do not like to show houses that are in a pending state, but if supply is low and demand high, they will do it and they will be asked to do it pretty often.

Smart realtors will always try to have a backup offer in case the first one falls through. The house that we ended up buying was shown through our entire closing period even though the sellers had executed a backup offer before our option period expired. I know for a fact that they received at least one or two additional offers even after our option period ended.

My understanding is that an executed backup offer becomes automatically binding if the initial contract falls through. Because of that even if the sellers get a higher backup offer, they cannot just walk away from the original backup offer for the higher one. If the initial contract goes through, then nothing happens with the backup.
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Old 08-22-2013, 10:50 PM
 
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Thanks guys,

sparks82, thanks for explaining. That's interesting about the backup offers.

Congrats on your recent house purchase!
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Old 08-22-2013, 11:20 PM
 
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As soon as the house's status changes back to "For Sale," then I'll consider a viewing.
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Old 08-23-2013, 03:34 AM
 
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Quote:
Originally Posted by sparks82 View Post
My understanding is that an executed backup offer becomes automatically binding if the initial contract falls through. Because of that even if the sellers get a higher backup offer, they cannot just walk away from the original backup offer for the higher one. If the initial contract goes through, then nothing happens with the backup.
As a buyer I might view a house that as already under contract, but I'd not sign any documents that would require me to buy the house should the original contract fall though. As a buyer, that would leave me "tied up" with a house that I might not even get, and thus prevent me from making offers on something else that I found.
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Old 08-23-2013, 10:52 AM
 
Location: Kansas City North
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Do they ever write backup contracts which simply state if Buyer #1 is unable to complete the transaction then Buyer #2 has the "exclusive" right to then enter into negotiations? Obviously there would be a short time limit for this exclusivity. Buyer #2 could still freely look at other homes, and neither party is locked into a price.
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Old 08-23-2013, 11:04 AM
 
Location: NJ
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I can't imagine any buyer that would be stupid enough to have a back-up offer automatically kick in if the first deal would fall through.
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Old 08-23-2013, 11:23 AM
 
Location: Scottsdale, AZ
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Viewing homes that are under contract will depend on the circumstances. Generally, I will place a call to the listing agent to try and ascertain the situation. If they tell me that it is a solid offer that is proceeding on schedule, we move on. If they indicate that they are looking for backups, I leave it to the client. Generally the only time I will place a back-up offer is if it is a short sale and the client is willing to wait weeks or months (which most of the time they are not willing to wait) just to hear. I may ask the listing agent to notify me if the deal is in jeopardy.

The other issue that concerns me about backups is why did the first offer fall out? If financing is the issue, which it is often in the lower price range, it is no big deal. But, if it falls out for inspections, that raises a flag for me because my buyer will now have to decide if they can overlook the problem(s).

One of the problems we face with the internet today is that there is so much bad information out there with regard to available properties. Buyers using the internet see dozens of homes that are either not really available or have unrealistic situations surrounding them that make them bad candidates for purchase. I try to show my buyers homes that they can actually purchase. That means weeding out the crap, which becomes a job in it self. Why waste time looking at properties that have very little success in closing?
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Old 08-23-2013, 11:27 AM
 
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I did. And my realtor called me the second the contract did not go through and the house popped back up on the MLS. I bought it.
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