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I got a call from an agent today and the conversation turned to a deal one of my team members tried to make on her listing which never went together. It wasn’t that they didn’t like our price, she explained. It was the seller concession. While the net to seller was quite acceptable, their attorney “didn’t like” the proposed concession.
My jaw dropped as she shared with me that the same thing happened twice before on that property. The seller and their attorney rebuffed what sounded like (certainly in our case) qualified, pre approved offers with good net to her seller over a seller concession. Instead of selling months ago, the house languishes on the market, no doubt having the price lowered as time passes.
Such lost opportunties over a prefectly fine, if misunderstood, term of sale reminded me of the old joke where the guy throws out an old baseball because it was from 1927, had people’s names all over it, and one of them, Ruth, was a girl anyway. How tragic.
There is an unflattering ethic among some older practitioners of both law and real estate in Westchester County that money not delivered in a Tiffany case is not money. Seller concessions, to some attorneys, aren’t what we do in Westchester County. No matter that they are perfectly legitimate. No matter that they turn otherwise non prospects into able buyers. No matter that it is good for the seller client to achieve their objective, which is to sell for as much as possible in a timely way. No matter that 15 minutes away in Rockland County or the Bronx that they are done with no issue, skin rash, or damage to the esophagus.
No, here in Westchester the ground water is different. We rest on a different tectonic plate. The acidity of the soil does not allow buyers to finance part of their closing costs and get homes sold in this recession. It is more than an absurdity borne of ignorance of the current market, it is a tragedy that a client is so poorly represented. These people had their house sold three times. And they have nothing to show for it.
Seller concessions, or givebacks as they are called in some places, are just fine and not uncommon in first time home buyers. Anyone who says otherwise has not done much in this market lately, and may in fact be incredibly out of touch with events of the last 3 years. I see them all over the place, and while we’d all love for buyers to plop 50% down or pay in cash, that isn’t possible. And of the deals I have seen not close, the concession was virtually never a cause.
Allowing buyers to essentially finance a tiny (3%) portion of the sale price to cover their closing costs is absolutely OK in almost every case I have ever seen. And in a slow market where able buyers are rare, it is unconscionable to rebuff an offer, essentially subordinating the well being of the client to a tired, snooty principle. And it is intellectually dishonest to invoke the client’s best interest over rejecting an offer so structured when killing a deal is in fact contrary to the client’s best interests. I’ve seen this cost sellers big money over time as they reduced in price.
Time on market is not the seller’s friend.
Rejecting an offer over a seller concession legitimately arranged by their lender is foolish.
This market is not 2005 where buyers are waiting in line, and squandering an able buyer is nuts.
Seller’s concessions, my friends, are perfectly OK despite what this attorney thinks. I have closed hundreds of them. That is why I get the results I get, while this home sadly sits unsold after 3 viable offers.
