Now before you go jumping to conclusions…this story isn’t about loan assumptions. I’d like to address an element of human behavior that affects buyers, sellers and Realtors in a manner that has little to do with the real estate process and everything to do about the way many of us are wired to think. Some may refer to it as proactiveness, though this may be the intention, it can lead to damaging results. Making assumptions in real estate during negotiations can circumvent the progression of a successful closing.

Nurturing Relationships Is About Transparent Communication

Let’s say you’re on the hunt for a home. As a buyer, you know you’re always looking for the right deal but what that means will differ depending on the person, the circumstances, as well as short- and/or long-term goals.

Currently, the Phoenix area marketplace is low on supply and high on demand; so, the pickings are slim. Moreover, available properties don’t always present as move in condition or showcase the best of cosmetic trends. In order to secure a house amidst the other weary and wanting buyers, sacrifices will undoubtedly be made. Some are emotional, others are financial.

Research Is Essential After Contract Acceptance

Once both buyer(s) and seller(s) have reached agreement on the terms and conditions, escrow is opened. And while all parties have likely done an overview of due diligence regarding value and neighborhood assessment, the inspection period begins allowing buyers and their representatives the chance to dig their heels into what’s behind owning that property. The good. The bad. And the ugly.

What you learn can define and redefine thoughts, expectations, and action.

With Disappointment Comes Resolve, Sort Of

Unless you are a real estate investor looking for property acquisitions, it’s likely that emotion is part of your purchase equation. Something about the house, condo, loft, townhome, or duplex got under your skin and excited your senses. You wanted it and now it’s within reach.

Throughout the inspection period, you’ve done the homework. Verified the schools. Did a neighborhood drive-by during different days and nights. Termite inspection…check. Home inspection…check. And then it happens.

You learn that your soon-to-be-prize possession isn’t all that perfect.

Instead of reluctantly taking in the information, digesting and accepting it, something else begins. Depending on your real estate agent, he/she/they too can fuel your fire.

The unexpected news can readily bring negative assumptions to rise.

A Case in Point

A client had asked a seller for some minor repairs and a reasonable credit at closing, a solution for two broken windows that needed replacement but not necessary for a loan approval. Again, I preface that the requests were nominal and far less than what I typically encounter.

Much to my surprise, and that of the buyer’s, the seller only agreed to some of the repairs. Okay, not a deal breaker. But what set my client and myself into a new level of disbelief, was the response to the request for a credit at closing for the broken windows.

Instead of a credit, the seller stated that the non-affixed kitchen island would be left for the buyer at the property.

Uh…did we ever know it wasn’t affixed? Did we ever know it wasn’t to remain there? No…and so I checked all the places it would’ve or should’ve been disclosed as such.

A bad taste in your mouth could turn it all sour.

As I referenced and cross-referenced the original MLS listing sheet which hosts information about the property, provided by the seller and posted by the listing agent, my buyer couldn’t shake the feeling she had inside.

What was supposed to be an exciting time now brought a bad taste in her mouth, not just for how the inspection negotiations were going but the entire deal. In fact, she was beginning to doubt her decision. Why? Her ability to trust the seller was compromised. Over two broken windows…or was it the kitchen island?

The tangible items mentioned were mere symbols of a larger issue at hand.

Real Estate Negotiation Power Is Supported by Contract Not Ego

Trust is a hard thing to come by in any real estate transaction. Buyers know that a seller will do what’s necessary to secure the highest net proceeds. Sellers understand that a buyer will try to realize the most gain (equity) even before the transfer of sale. What each party doesn’t know is to what length either side will go to achieve these endeavors---lawfully or not.

The real estate contract offers a sort of checks and balances in place for buyers and sellers. Though there is room for interpretation of law, intent and innuendo, that can paint areas of gray. Perhaps the two most questioned, if not argued characteristics about the details of a real estate transaction are in the elements of disclosure and misrepresentation.

The Fear of Disclosure

For my client, hearing the news about the no-credit-have-the-kitchen-island-instead was like someone took a pin and burst her bubble. For me, I was incredulous at how this was playing out.

Being that I like to look at deal points as a rational chain of events, I tried to make sense of the response. I couldn’t. The more my buyer revealed her disdain and disgust, the more I wanted to find a way to understand the response and overcome it. Again, this was beyond the windows and kitchen island. My buyer simply stated, “How am I supposed to trust anything that the seller has said and done?”

Truthfully, I didn’t blame the buyer for the shift in sentiment. Did the listing agent understand the potential ramifications that lie in wait?

Which chess game are we playing…

As I tried to calm the buyer and stick to the issues at hand, my mind raced with a myriad of undesirable possibilities. Was there deliberate deception? Was there a realm of animosity from the seller that would give cause to the response?

This wasn’t just about the slap in the face that stung the buyer hard, it was about miscommunication in the listing process (at best). Although, I knew that the fear of disclosure is very real for some sellers. But this scenario was more about misrepresentation. What was hanging in the balance was the $1000 credit asked for, denied, and replaced with a kitchen island.

The Dangers of Misrepresentation

This still may seem a bit frivolous. This kitchen island is one of two things to the seller: personal property or part of the home. Depending on which it is will dictate how the item is handled in the listing documents, showing process, and ultimate sale.

Misrepresentation is the vehicle that drives incorrect portrayal about anything related to the property itself or the ability to transfer the sale of property.

If the seller engages in misrepresentation, the listing broker is often an unwitting participant, at least in the eyes of the buyer and buyer’s broker. Ah… then there’s the assumption. Here’s where we must stay calm and carry on.

The MLS listing sheet showed that the kitchen island did, in fact, come with the sale of the home. It was posted as part of the kitchen amenities. I then scanned to the other parts of the listing… the public remarks, the semi-public remarks, the private remarks, all places where a listing broker can state what items in a home do not transfer with the sale. Nowhere did it state that the kitchen island “did not convey”.

In addition, each time I showed the property, there were no signs posted on the kitchen island that stated DOES NOT CONVEY.

My blood was starting to boil. Okay, it was simmering.

Communication Is the Benefit of the Doubt

I called the listing agent who, up until this point, was a pleasure to work with. I explained that there was some ‘confusion’ in the seller response regarding the windows. Basically, my stance was “How can you offer something as added compensation when it was already part of the deal?”

She was stymied. I literally had to walk her through the entire process of how she listed the kitchen island as part of the house offer, and there was no disclosure regarding it not being included in the sale.

Realizing the situation that her client, no doubt, put her in, she vowed to go back and revisit the repair request for a credit a closing and that the kitchen island was, of course, included in the sale.

What was also refreshing is that she let her ego down and revealed that she was new to the business. This explained a lot. I could’ve easily thought she was ill-intended and attempting to deceive the buyer. Her honesty was helpful, and we worked together to resolve the situation.

Realtor Trust and Success Go Hand in Hand

I suppose there are two ways to view the other party in a real estate transaction: an adversary or partner. In an adversarial relationship, we would assume (ass-u-me) the worst. In a partnership, we would assume the best and certainly be committed to achieving mutual success.

The cornerstone for a solid transaction is in the latter, to construct and achieve a deal that all parties come away with as “a win”. Isn’t that what we all want?

Start a Winning Real Estate Experience Here