Honour in property sales.
Is there any honour left in the property business? We sometimes think not but then come across really wonderful people whose word is their bond and who would never renege on a deal.
The thing is, honour, in the sense of sticking to your word, is a two way street and you cannot expect a seller to honour a deal if a buyer isn’t completely straightforward.
A typical example of starting off on the wrong foot is; a buyer makes a ‘silly’, unrealistic offer, followed up, after embarrassing conversations between the agent and the seller, with a good offer. By then, the seller is upset. If, subsequently, there is any ‘messing around’, the seller is not going to feel any compunction at going back on the market.
So buyers need to make sensible offers and not ‘mess around’.
Another example of ‘messing around’ is the buyer telling the agent they are a cash buyer with nothing to sell, and later on, admit they have a property on the market and no buyer…or, telling the agent you are cash, when, what you really mean is; you’re getting cash from raising a loan or mortgage.
Sellers…’messing around’ can be; playing buyers and/or agents off against each other so they don’t know what to believe and then won’t deal with you because they lose trust. Thankfully, with recent changes to Consumer Protection Regulations, activities like this can get sellers a criminal record so we expect a lot less of this. Or, when the seller gets a good offer, telling the agent the asking price is too low and then putting it up....not a good idea if the seller really wants to move.
Another invidious practice is to put a property on the market and, when a buyer is found, the seller does not want to agree a sale as they have not found a property to buy. In that very uncertain scenario, what should the buyer do? On the whole, they will keep looking. What then happens is; the seller finds a property to buy but the prospective buyer has bought elsewhere.
When people have a buyer, the best advice is to put the sale in hand with solicitors immediately. It shows good faith. A good, honourable agent will explain to the buyer clearly that they may have to wait a little before getting completion. That is the normal state of affairs. Managing expectations is the name of the game. If buyers and sellers are clear about timescales and issues they will hold on. Sellers need to ensure their solicitors are working proactively to get clear information to buyers as quickly as possible and buyers need to get their money in place too. Both sides have responsibilities to make things happen. A pro-active agent can be a great help in this period.
Gazumping: If you agree a price, stick to it and give the buyer time. Keeping a property actively available to be sold to another party when you have a buyer proceeding, is not good practice. Now, with the CPR regulations mentioned previously, you need to advise the buyer you are doing that, in which case they are quite likely to withdraw their offer and leave you back at square one.
Buyers, once you agree a price, don’t drop your offer at the last minute unless serious problems are uncovered which definitely are going to cost much more than you envisaged.
The main thing in property sales is: Do as you would be done by…be nice, be sensible and keep a sense of proportion. Deal with an agent and a solicitor who respect these values too.
The pic is of our wonderful and straight talking Timothy Denning.
Paul Bonett F.N.A.E.A. M.A.R.L.A.