In a hot
market, sellers have more leverage than they have had in years. Rapidly rising prices and a slight uptick in
mortgage rates and causing buyers to move quickly on new listings.
But not all
buyers are the same. Nor are all buyer’s
agents.
As I have
mentioned in previous posts, when I work with sellers I am legitimately
concerned about who the other parties are in our transactions. Is this buyer really qualified to buy a
home? Does he have a reputable
lender? Does he understand the
market? Is he really motivated? And does the agent he is working with have a
track record of closing sales?
When you
list a home and it goes under contract, the last thing you want to have happen
is for that transaction to be derailed by some avoidable concern.
And the
truth is, there are agents who know how to solve problems, and there are agents
who know how to cause them.
In a market
where multiple offers are increasingly common, I’ve implemented a principle I
call the “20/20 Rule”. In short, it
means that we are looking for a buyer with a 20% down payment working with an
agent who closes 20 or more deals a year.
(That doesn’t mean we always find a buyer who fits the 20/20 Rule, but
the principle is still relevant)
If you can
find these two dynamics, I put your odds of closing successfully somewhere
around 95%.
Another way
to phrase this is that serious sellers should be looking for serious buyers
with serious agents.
A full-price
offer is rather meaningless if the buyer is working with a brand new agent,
borrowing his down payment and using a promissory note for the earnest
money.
As a seller,
you are damaged when your home goes under contract and then reappears as an
active listing a week or two down the road.
Because that history is traceable in the MLS, buyers and agents often
assume “there must be a problem with the home”, when in reality, often there
was a problem with the buyer or the buyer’s agent.
So choose
whom you contract with wisely, because it takes both cooperation and competence to successfully close a
deal.
