Buyer's expectations these days (contingency, appraiser, agent, sales)

[rubytue]

First off, I'm not on the market. We bough about two years ago We *may* have to list next spring depending on lots of things, but thats another post. We planned to stay much longer, but life throws you curve balls sometimes.

So I'm reading here and other boards, along with way too much HGTV (I've always loved it LOL). One another board, I saw someone say "If the a/c has less than 3 years left, I'm automatically knocking $3k off the house." On one of the stupid episodes of "My first place" or one of those, one lady said "I want EVERYTHING done," in reply to an inspection on a 5-year-old house. When/where does logic come in? Maybe the first house was priced to account for an older a/c unit? And who can predict the a/c will die in 3 years anyway? As for the second lady - if you want prefection, buy a new build - and then realize that won't get it either as you call the builder back for warrenty repairs.

Is it only first time buyers who think like this? Does everyone? I'd blame it on TV, but I've seen it in person, too.

And I guess the root of my concerns - our house is 40 years old. The inside is completely updated (we put in new bathrooms, redid the basement, refinished the hardwoods, new kitchen appliances/floors/counters/backsplash). We've rewired (AL wiring), replumbed (PB pipes), and have a new a/c. But thats where we have to stop. I can't put on a new roof. I can't pour a new driveway. *sigh* Oh yes, overimproved. Know that. Good part is hubby is contractor so this was all reasonable cost-wise. But still. At this point, we hope to walk away with some cash, and chaulk the rest up to the loss of imaginary money that came from selling house #1 (in DC at peak).

[redpanda]

I really think it depends on the particular buyers; how much their agent has educated them and where they are in the buying process. My house is lovely and completely updated (both systems AND cosmetics) and is priced very competitively, but you wouldn't believe some of the things that people quibble about. One buyer was concerned that there was no vent over the range in the kitchen (we didn't want one because of how the kitchen is set up--it would break up the open-concept flow--but it's not a big deal to put one in if you want one!). One buyer said he was "too tall" for our house (I'm 5'11" and my husband is 6'4"...and we have 9' ceilings). Someone else wanted central A/C (which is almost unheard of around here unless you're buying a condo). And of course, we had buyers walk over a simple repair that would cost under $1000 and that we would have completed if they'd given us the opportunity.

So really, it's all over the map. I think, in my case, marketing to first-time buyers offers the most challenges because many of them just aren't yet ready to be realistic at the beginning of their search.

Good luck!

[Chuckity]

First time home buyers usually have had their minds warped (and their expections) by HGTV. Well, I don't know if HGTV is 100% to blame - there is a huge sense of entitlement going on in that generation.

When I'm working with a first time home buyer or someone under 30'ish, it can be a challenge to even get them to see beyond paint.

And when it comes to inspection time - I really try and make it clear that an inspection is not cause to create a "honey do" list ... and I'm really not clear how that trend started either. (And when I hear of buyer's walking over things that aren't major defects, I'm always a little perplexed because it's not an out in our contracts - only major defects are.)

I just worked with a young couple and we get to the final walkthrough the day before closing and dad comes with for the first time. And dad blows a gasket because (and this was a 50 year old home) of some very minor things - a cracked handle on a cabinet being one of them. Lost his ever loving mind. Why in the hell didn't we have the sellers fix it??!!! So, on the other hand I'm not quite sure it's a sense of entitlement in the younger generation or it's just a jerk thing.

[NC_Paddler]

Originally Posted by Chuckity

First time home buyers usually have had their minds warped (and their expections) by HGTV. Well, I don't know if HGTV is 100% to blame - there is a huge sense of entitlement going on in that generation.

Please correct me if I'm wrong, but the seller is not required to fix anything accept those deemed "necessary repairs", which in most cases is broken appliances, faulty structural components, drainage issues and such, right?

The buyer cannot walk away from a contract if the seller chooses not to fix cosmetic issues like the ones you mentioned, correct? Or can they choose to terminate the contract and forfeit their earnest money in that instance?

Thanks.

[Chuckity]

Originally Posted by NC_Paddler

Please correct me if I'm wrong, but the seller is not required to fix anything accept those deemed "necessary repairs", which in most cases is broken appliances, faulty structural components, drainage issues and such, right?

The buyer cannot walk away from a contract if the seller chooses not to fix cosmetic issues like the ones you mentioned, correct? Or can they choose to terminate the contract and forfeit their earnest money in that instance?

Thanks.

I can only speak for our purchase agreements & specific addendums pertaining to each individual sale.

It's case & state specific - you need to read the purchase agreement & any addendums.

[chet everett]

Despite the fact that standard sales contracts will generally have a very limited number of "outs" the MINDSET of too many buyers, both first timers and those that have their expectations warped by any number of factors (including TV, family, on line forums...) is often that a purchase guarantees "perfection".

The mindset of too many "professionals", including appraisers and inspectors, also tends to reinforce the myth that there is a finite and predictable lifespan for every element of a house. "50% of roof life" "water heater beyond guarantee" "furnace not in compliance with Energy Star guidelines" are things that I suppose some 'professionals' find helpful but seem to be biased toward a mindset of "soak the seller"...

To be sure, the entire property SHOULD be evaluated with regard to age & condition, but not as a "magic checklist" that will result in the sellers underwriting a whole new house for the blessed buyers. The evaluation should be such that the worth of the property as collateral is sufficient for the lender and the details of the major components / system should be verified to be "as advertised".

Adequate preparation / education of the BUYER on the part of skilled real estate agent SHOULD be a key component in helping to get a "level set" of expectations.

[Silverfall]

Originally Posted by NC_Paddler

Please correct me if I'm wrong, but the seller is not required to fix anything accept those deemed "necessary repairs", which in most cases is broken appliances, faulty structural components, drainage issues and such, right?

The buyer cannot walk away from a contract if the seller chooses not to fix cosmetic issues like the ones you mentioned, correct? Or can they choose to terminate the contract and forfeit their earnest money in that instance?

Thanks.

In Oregon they can choose to unconditionally disapprove of the inspection report. The only negative thing can be a loose door hinge and they can still disapprove. If that is the case then they are either playing games, or their agent didn't prep them for home ownership.


Rubytue, if you do have to sell get a prelisting home inspection. About a month before you want to list get one done. Many buyers are walking over repairs that sellers are more than willing to fix. They just aren't giving sellers a chance. Try and remove that possibility from your sale and find out what, if anything, major is going on.

Then fix all the small things as you go along.

I think the reason for this dynamic is the HGTVification of homes showing people doing projects cheap with free labor on the show, AND buyers are watching sellers take a bath on homes in a declining market and vow NOT to be in that position.

This is creating a hypervigilance of sorts with regards to home purchases.

[NC_Paddler]

Originally Posted by Chuckity

I can only speak for our purchase agreements & specific addendums pertaining to each individual sale.

It's case & state specific - you need to read the purchase agreement & any addendums.

My contract explicitly states that only certain items, like the ones I mentioned, are required to be repaired. I was just curious if that was a standard stipulation in most contracts.

At least I know the buyer can't use a nail pop as an excuse to walk away; I would hope (for the seller's sake) that most contracts would also include that stipulation.

[Narfcake]

Originally Posted by redpanda

So really, it's all over the map. I think, in my case, marketing to first-time buyers offers the most challenges because many of them just aren't yet ready to be realistic at the beginning of their search.

Most of these are brainwashed from the media. "OMG, prices are plummeting", "It's a buyer's market.", and all the DIY renovation shows that make it seem like a remodel can be done in 30 minutes "so why can't the sellers do that too?".

I'm a first-time homebuyer that just closed escrow last week ... major repairs (water main, furnace, water heater, a/c) was over $6k and semi-moderate repairs (leaky toilet, sink, damaged cabinets, concrete damage, old fencing, sagging garage door, etc.) would've easily pushed the total to $10k. Never mind the cosmetic stuff like paint (poor color choices by the PO), popcorn ceilings (which I'm in the process of scrapping off), the worn carpet, original 1980 kitchen/bathrooms/etc. that are big detractors to many folks. Me ... I went off on the aspect that while it needs work, the house is structurally sound and that I'm buying in about $50k below comparables.

I totally agree that the buyer's agent needs to educate their client on setting realistic expectations. The "perfect home" isn't likely going to be the cheap category ... either it will cost more, or the house needs work. You can't have both.

[Chuckity]

Originally Posted by NC_Paddler

My contract explicitly states that only certain items, like the ones I mentioned, are required to be repaired. I was just curious if that was a standard stipulation in most contracts.

At least I know the buyer can't use a nail pop as an excuse to walk away; I would hope (for the seller's sake) that most contracts would also include that stipulation.

On the other hand, how hard are you going to hold them if they want to walk from a nail pop?

I know most people's initial reaction is to say they're going to hold their feet to the fire but - if they no longer want to purchase, it's going to be a long hard road.

Kinda crappy for the seller but true. Sometimes you just need to lick your wounds and be done with it.

If you want to pursue legal action, forget about selling your home to anyone else - it'll be tied up (and you could potentially lose another willing buyer) in the meantime and still not have your initial contract go through.

And if there's a financing contingency that hasn't been met yet? There's an out for them as well.

And as for keeping the earnest money - I don't believe I've ever seen earnest money not returned to the buyer. I'm sure someone can come up with an instance where it's happened, but it's really not a common occurrence AT ALL where a deal falls through and the seller keeps the earnest money. It just doesn't happen.