It has become a thing around here, and we got bit by it this week. I'm pretty angry at our buyers who played us. Our agent tells us it is an increasing complaint from realtors in the last month.

We had a cash buyer (no need for them to get a mortgage) and no contingency on selling a home to buy ours. As usual they had a due diligence period to inspect the home for hidden problems. (No problems found, the house is in perfect condition). They asked for a really fast close date after due diligence.

Then ... after doing all the inspections the buyer says they're pulling out because it wasn't really the right house for them. But for the right price reduction it could be the right house...

We are, of course, under contract to buy a home with only a week before closing on it. We have a contingency on selling this house, so we can walk away from the new one still. But there is certainly pressure due to the short timelines.

Due diligence has become something other than a period of time to discover hidden problems.

Annoying especially when you're selling your house in order to buy another house. If you can stand it I wouldn't renegotiate price, tell them the price is the price previously agreed upon. In my area houses are selling quick but every market is different. Good luck with your sale and maybe you'll get a better offer than what you have.

At least you get to keep their deposit.

That totally sucks.

Is there a non refundable due diligence fee? In this area, a buyer has to pay an up front due diligence fee and if the deal dies, they loose that money. Keeps some of this crap from happening but puts a lot of risk on the buyer if surprises come up during home inspections.

That sounds like they were trying to scam you.

I'm starting to see houses all around here getting reduced though. I think the party may be over soon.

Tell them to pound sand

Unfortunately the deposit is fully refundable until the due diligence date. That's standard procedure around here but I will talk to the realtor about going non-refundable on the next buyer.

I do believe they were setting out to scam us because they asked for a longer than normal due diligence followed by an immediate close. This way we are totally cornered in terms of buying something else. We either agree to their extortion or we risk not getting as good a price from the next buy, and possibly lose the house we planned on buying. We also lose what we spent on inspections of the new house (about $750).

It is a cash buyer, and the funds were verified. So they lured us with that, too. No worries about them having to get a mortgage or sell their current home. We just had to pass the inspections, and being a new-ish custom home that we have lovingly taken care of, I know there is absolutely nothing wrong with it.

They played us, with one of them being the face of the deal and being very positive about everything. Then the spouse suddenly decides it isn't the right house for them, but it could be right if we'd agree to a price reduction.

I would love to sue them for the deposit, which is sizable, since we passed every inspection, going by the strict wording. There were no defects, and no issues with things like square footage not being as advertised. But my guess is this has been tested in court before and wouldn't be worth our time.

quote:

Originally posted by PASig:
I'm starting to see houses all around here getting reduced though. I think the party may be over soon.

Yes, the market has started turning in the last 2 or 3 months. Prices are reducing. Some of it is people looking at the highest peak $ per square foot last year and unrealistically trying to do even better this year. Homes either sell really fast, like ours did, when priced correctly, or they sit for months due to price and other problems (road noise, weird floorplan, etc).

This game of coming back for a price reduction is a new tactic the realtors are just starting to see.

I hope realtors blacklist buyers who do this.

quote:

Originally posted by calugo:
Annoying especially when you're selling your house in order to buy another house. If you can stand it I wouldn't renegotiate price, tell them the price is the price previously agreed upon. In my area houses are selling quick but every market is different. Good luck with your sale and maybe you'll get a better offer than what you have.

quote:

Originally posted by BigSwede:
Tell them to pound sand

I used 4 letter words, to my wife's embarrassment! She was willing to consider a small price concession if it would sooth the buyer's ego and make the deal happen, but I told her the price for those buyers just went up at least $100k. With a non-refundable large cash deposit, no contingencies, close by next week.

If I'm going to lose money because of them, I'm not giving the money to them. I'd rather make another year or two of mortgage payments and stay.

quote:

Originally posted by Fly-Sig:

This game of coming back for a price reduction is a new tactic the realtors are just starting to see.

I hope realtors blacklist buyers who do this.

Their realtor may be in on it for all you know

Yep we saw this BS last year when selling our beach house and the GD realtor said there wasn’t much we could do to which I said Bullshit!
I let them walk, which I think surprised them and then adjusted the new listing to specify a short Due diligence time frame with a non refundable deposit of at least $10,000.

It took a month but we eventually got a buyer who paid full asking price and closed without issues.

You are the seller and you can set the terms regardless of what your realtor may say.

"OK, you want to renegotiate? For an extra $5,000, I'll forget you tried this shit and still sell you the house."

We had a buyer submit a full price offer when we listed our home “For Sale by Owner.” A realtor brought them and wanted 3%. We agreed but he wanted a 6 month listing agreement. We said no and offered a “Name Only” listing.

The realtor said “No Way”. After that the buyer suddenly walked. It was a scam to get a listing agreement and the buyer was probably fictional. It’s not only buyers who are less than honorable. Asshole.

We were in a similar situation but on the other side. We made an offer on the house which was asking with an inspection/VA loan. The sellers accepted a cash offer. The inspection came back with a couple of issues or possible issues. The HVAC, well pump, septic and roof were all original to the house which was 20years old. The first people backed out (the roof was $35k). We came back with as is pending a septic inspection, I had just replaced mine 5 years ago and it was a painful and multi month process.

The septic field failed and was reported to the county health dept so there was no hiding it. The people wanted a premium price for a house that was not in premium condition. Our answer was take $30k off the price or fix the septic with out choice of contractor. The reality was they were not going to get what they wanted or even close with another buyer. They were pissed! There were a slew of other shit that came up after we took possession of the house.

quote:

Originally posted by Valpo Fz:
We were in a similar situation but on the other side. We made an offer on the house which was asking with an inspection/VA loan. The sellers accepted a cash offer. The inspection came back with a couple of issues or possible issues. The HVAC, well pump, septic and roof were all original to the house which was 20years old. The first people backed out (the roof was $35k). We came back with as is pending a septic inspection, I had just replaced mine 5 years ago and it was a painful and multi month process.

The septic field failed and was reported to the county health dept so there was no hiding it. The people wanted a premium price for a house that was not in premium condition. Our answer was take $30k off the price or fix the septic with out choice of contractor. The reality was they were not going to get what they wanted or even close with another buyer. They were pissed! There were a slew of other shit that came up after we took possession of the house.

I have no issues with asking for either a repair or fair $$ for a legitimate issue. That's why there are inspections and due diligence.

There was nothing on our inspection other than a minor cosmetic (water spots from rain inside a door) which the wife washed off. It would be douchebaggery but legal for them to have backed out of the deal on the basis of not liking water spots. It is plain dishonesty from the get-go to use the due-diligence to renegotiate the price.

quote:

Originally posted by mcrimm:
We had a buyer submit a full price offer when we listed our home “For Sale by Owner.” A realtor brought them and wanted 3%. We agreed but he wanted a 6 month listing agreement. We said no and offered a “Name Only” listing.

The realtor said “No Way”. After that the buyer suddenly walked. It was a scam to get a listing agreement and the buyer was probably fictional. It’s not only buyers who are less than honorable. Asshole.

Infuriating!

A buddy of mine is a top notch real estate agent and I do photos for RE listings for him and a few other agents so I hear a lot of stories.

All cash and quick close, etc - Higher earnest money and unless it is something that comes up on the inspection, nope you don’t get the earnest money back.

Once you pull it off the market, you potentially lose other. Buyers. Especially this time of year. RE is quite seasonal and things are slowing down. Won’t pick back up til spring in most areas.

Just went through something similar. Agreed on price but found a few potential biggies. Radon test failed and some regular mold on the particle board roof plywood. I normally sprayed the attack every 7-8 years. Anyhow, I countered on a reasonable discount to resolve those issues. They hung onto needing 15k in discounts. I told them thanks but no thanks and walked away. In 4 days they came back and accepted my “as is” offer. Hoping to close in 2 weeks.

Before I listed I got a bunch of calls from investors. They all seemed to want a dump they could rehabs or people that needed to get rid of their house fast due to financial difficulties.

I thought standard practice on period of inspection was usually 7 days or so, after that deposit is no longer refundable?

quote:

Originally posted by Georgeair:
I thought standard practice on period of inspection was usually 7 days or so, after that deposit is no longer refundable?

14 days is typical here, then it is non-refundable. Sometimes hard cash non-refundable deposits happen when the market is hot, but it is softening for sure around here.

We were curious about the longer requested due diligence they wanted (and we agreed to) because they were cash buyers with the funds verified in the bank. They're out of state buyers, so we understood the issues of travel. We know there is nothing wrong with the house so any inspections would pass. And to top it off, this was a buyer who, like many around here, was waiting for the exact right property. Realtors quietly and patiently watch for their clientele. 70% of home in our zip code are second homes owned by very wealthy out of state people.

As expected, before the listing even went live we had a showing and the offer. Textbook situation for a smooth transaction.