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April 30 has come and gone and somehow, we survived

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We survived! (For now)

It’s now 9 p.m. on D-Day … April 30, 2010. The tax credit has expired (thank God) and from what I hear there will be NO extension this time.

While the world did not explode (or implode either) for real estate agents, as far as I can tell, this was one wacky week. (Read my post from a few weeks ago on the ticking of the expiration of the credit, and Benn Rosales’ post on the end of the credit. I agree wholeheartedly with Benn’s opinion, by the way.)

Buyer types

I personally didn’t have any last minute buyers running around in a total panic as April 30 approached. We had buyers who didn’t find the right house, and they’re okay with that. They’ll keep looking,  but at their own pace. The tax credit was just icing on the cake, but not their main motivation for buying.

We did have a handful of buyers in the office who indicated they would not continue looking after April 30. I question their seriousness. They were mostly looking for “a steal” and if they found a true bargain, something too good to pass up, they’d buy it. If not, oh well. Are those the kinds of buyers ANY of us enjoy working with? Not me. I want someone who wants to move, and is motivated, for whatever reason. I don’t want permanent lookers trying to buy filet mignon on a hot dog budget.

Now, to get to the week’s strange stuff.

Wacky week in review

The weird stuff seemed to come from other agents, not so much from the buyers (okay, a little from the buyers).

We had several agents try to call in verbal offers. Office policy is to get all offers in writing (isn’t this Real Estate 101?). We tell agents who try this that we will communicate the message to seller, but that a verbal offer isn’t worth the paper it is (not) written on. It’s meaningless. No offer in writing, no deposit check, proof of financing, all terms and contingencies — no “acceptance” from seller.

Agents running out of time seemed to forget this basic rule. They begged, threatened and one screamed at me on Thursday that “Tomorrow is April 30, for God’s sake, can’t you bend your rules?”

No. Sorry. We will tell the seller about your buyer’s “offer” and advise that he doesn’t commit to “accepting” anything verbal. Put it in writing, with all supporting documents, if you’re serious.

“Buying” sight unseen

Another strange one called today at 4 pm with a verbal offer on a property she had never been inside. This “buyer’s agent” (How can you represent someone if you’re willing to put in an offer on a property you’ve never seen, the buyer has never seen, and in an area you are not familiar with? That’s another post.) said her out of town buyer would submit a verbal, and if the seller accepts THEN and only then will the buyer and the agent drive to my area to see the property. Oh, and the offer is contingent on the buyer liking the property.

Is it a  full moon? Seriously. What planet are these people on? (1) Verbal offer is not acceptable and (2) How are you representing your buyer by this nonsense?

Half baked hasty contracts

Then there were the half-baked written offers hastily submitted. One had no terms, no proof of funds, no contingency info, and no date of settlement or date for seller’s reply. When asked for this info, agent said “Just fill in 30 days or something like that.”

Huh? Your buyer signed this half blank document and you want me to fill in what I want? Seriously? How about you do it right the first time then I’ll sit down with my seller and go over it.

I didn’t see a huge sales blitz this week. I have heard second-hand tales of agents submitting offers for multiple buyers today, running around and trying to get last minute signatures. But I didn’t see this personally.

The truth is most of my business is from the seller’s side. I represent far more sellers and landlords than buyers. So I wouldn’t necessarily be the agent running around with buyers in the car, trying to find the perfect house before the credit expired. But the agents in my office didn’t get frantic today, even the ones mainly representing buyers.

A soft summer?

A few sales this spring I think were to good buyers who would have bought in summer or fall, but pushed up their buying process faster to take advantage of the tax credit. The downside is those are sales we have simply pulled forward, into spring. That could make summer and maybe fall weaker than they would have been without the credit.

So now we go back to normal, whatever that is.

CC Licensed image courtesy of hitzelberger via Flickr.com.

Erica Ramus is the Broker/Owner of Ramus Realty Group in Pottsville, PA. She also teaches real estate licensing courses at Penn State Schuylkill and is extremely active in her community, especially the Rotary Club of Pottsville and the Schuylkill Chamber of Commerce. Her background is writing, marketing and publishing, and she is the founder of Schuylkill Living Magazine, the area's regional publication. She lives near Pottsville with her husband and two teenage sons, and an occasional exchange student passing thru who needs a place to stay.

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21 Comments

21 Comments

  1. Vicki

    April 30, 2010 at 11:19 pm

    I don’t understand all the articles I’ve seen about buyer’s agents running all over town getting contracts signed. Don’t they know about electronic signatures? I use Docusign, and it takes about 5 minutes for me to put an offer together and send it to my clients, then it takes them about 30 seconds to sign and we’re done! I still have to put a cover email on it, and attach a bank statement showing their cash to close, but I don’t have to waste time and gas running around to get this.

    • Erica Ramus

      May 2, 2010 at 8:44 am

      Vicki — I love Docusign. It is the way to go. However, in my area we are the only firm I know of using it. Other agents and brokers don’t understand what I’m doing. Even if someone is in the same town, why get in the car, drive there, get the sigs, then drive back to the office to fax it to the other agent? Ludicrous.

      I had one broker argue, why don’t you just go get the signature in person if the seller is around? I told him because in 10 minutes I can have your signed paperwork. Don’t you want that?????

  2. sharonalters

    May 2, 2010 at 1:27 am

    The buyers we have been working with did not necessarily qualify for the tax credit, nor was it their sole motivation for buying. It did cause the two who were interested in it not to pursue a short sale so they would be guaranteed of a June 30 or earlier close.

    • Erica Ramus

      May 2, 2010 at 8:44 am

      Sharon, yes short sales were tough! We had buyers we discouraged from making offers because of this problem.

  3. Michelle DeRepentigny

    May 2, 2010 at 9:00 am

    Personally, I am glad to see the tax credit gone! I have many potential short sales listed and have watched activity wane on them for the last 45 +- days – as a large part of the buyer pool was too impatient to accept the time lines associated with getting third party approval of the short sale. Now that the tax credit is a thing of the past, I expect activity to pick up on my potential short sales listings again.

  4. An Bui, DocuSign Social Media

    May 2, 2010 at 11:06 am

    Vicki, Thanks for the mention of DocuSign! Are you using the feature that enables your clients to upload / attach their bank statement when you request their eSignatures?

    Erica, thanks for being an early adopter 🙂

  5. Fred Romano

    May 2, 2010 at 7:44 pm

    DocuSign is amazing. I use it with every client listing, and since I do mostly “entry only” mls service, it makes perfect sense for my clients.

  6. Karen Goodman

    May 2, 2010 at 7:51 pm

    I was one of those agents who had a crazy 11th hour deal. I put a new listing on the market on Tuesday afternoon. It’s a nice house in a popular subdivision where average DOM for the last year was 14 days…even without the tax credit expiring.So, we were hoping for a sale in a couple of days and we got it, but we certainly didn’t expect this.

    Wednesday a brand new agent called to schedule a 9-9:30 PM showing for the house with Centralized Showing. The instructions were set at courtesy calls (automatically confirmed unless the seller says no when they are reached or call back to decline). The seller said it was too late, but when CSS tried to call the agent back the number didn’t work. They did send an email but she didn’t get it in time. So I get a frantic email at 9:30 that says that someone just knocked on their BEDROOM door. They had turned out the lights after putting the kids to bed and went up to their bedroom. Didn’t hear the agent or buyers as they looked around until they made it to the bedroom. Yikes. My clients were nice about it and let them see the entire house except the bedrooms with sleeping kids.

    The buyers came back for a second look on Thurs at 6:30 pm, then hemmed & hawed over a few issues. The agent finally emailed me an offer at 11:15 PM. Thursday night. We managed to work through the lowball offer and the buyers changing their mind and wanting a longer closing date than they asked for originally. They got their officially accepted contract at 8:15 PM on Friday. Less than 4 hours to spare.

    I sure hope that the tax credits never come back. I don’t want to deal with that again.

    Oh, and we had 3 showing requests for Saturday…the day after the tax credit expired. I have no doubt we would have sold this house easily with or without the tax credit.

  7. Paul Francis

    May 3, 2010 at 3:04 am

    Lots of laughing on the wackiness…. it seems as if the really wacky were agents themselves which were probably the ones selling it so hard to begin with. I’m working on the Vegas April numbers right now… around 43% of the closings were cash deals. I don’t think they really cared about the tax credit.

    On another note… the next couple of months could get really interesting. The latest Loan Servicers report for March shows a year over year increase of delinquencies of 15.7% and Foreclosure Inventory up 32.9%…

    Double Dip? Now that the Tax Credit and purchase of MBS by the FED is over… I’ll take any bets against it.

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